US Trade Deficit Plunges Most Since The Financial Crisis

What a difference a month makes: just 30 days after the US posted the biggest trade deficit since the financial crisis, when the US trade balance was some $57.6BN against the US, moments ago the BEA reported that the US trade deficit plunged by a whopping $8.7 billion, dropping to $49BN, better than then $50BN expected, and the biggest monthly drop (in dollar terms) since the financial crisis.

According to the census bureau, the deficit decreased from a revised $57.7 billion in February to $49.0 billion in March, amid a perfect trade environment as exports rose and imports declined, or as Trump would say, “his policies to boost US trade worked.”

Broken down by category, the goods deficit decreased $7.5 billion in March to $69.5 billion. The services surplus increased $1.3 billion in March to $20.5 billion.

The good news: exports of goods and services increased $4.2 billion, or 2.0%, in March to $208.5 billion. Exports of goods increased $3.7 billion and exports of services increased $0.4 billion.

The increase in exports of goods mostly reflected increases in capital goods($1.9 billion), in foods, feeds, and beverages ($1.0 billion), and in industrial supplies and materials ($0.9 billion).

The increase in exports of services mostly reflected increases in maintenance and repair services ($0.1 billion), in travel (for all purposes including education) ($0.1 billion), and in transport ($0.1 billion).

Also good news, if only for GDP bean-counters: imports declined, decreasing by$4.6 billion, or 1.8%, in March to $257.5 billion. Imports of goods decreased $3.7 billion and imports of services decreased $0.9 billion.

The decrease in imports of goods mostly reflected decreases in capital goods ($1.5 billion), in consumer goods ($0.9 billion), and in industrial supplies and materials ($0.7 billion).

The decrease in imports of services mostly reflected decreasesin charges for the use of intellectual property ($0.9 billion) and in transport ($0.1 billion). Charges for the use of intellectual property for February included payments for the rights to broadcast the 2018 Winter Olympic Games.