November 2019 Balance of Trade
Submitted by Atlas Indicators Investment Advisors on January 17th, 2020
America’s trade balance improved in November 2019 according to data from the Bureau of Economic Analysis. The nation’s deficit improved to $43.1 billion from the upwardly revised count of $46.9 billion (originally $47.2 billion). In short, both sides of the ledger improved for America as imports fell while exports increased.
November exports were $1.4 billion more than in October for a total of $208.6 billion. Capital goods exports rose $600 million led by drilling and oil field equipment as well as civilian aircraft engines. Consumer goods exports were $50 million better as foreign buyers increased jewelry and gem diamond purchases. Automotive vehicles as well as engines and parts also contributed to the uptick by adding $40 million to their previous total. Finally, improved spending by foreign travelers to the U.S. also helped exports by boosting services.
Imports declined $2.9 billion in the period. Firms invested less in foreign made capital goods including declines for computers and civilian aircraft totaling $600 million each. Individuals followed a similar path as imports of consumer goods declined $1.0 billion; fewer purchases of cell phones as well as artwork and other collectibles lowered the category’s tally. Industrial metals were purchased at a slower pace as were auto-related goods. However, Americans had the travel bug too; trips abroad helped boost imports of foreign services.
This indicator has been improving lately. In December 2018, it reached a level close to those experienced just before and during the Great Recession but reversed course afterward and is now at the best level since October 2016. This should help support the fourth quarter gross domestic product total since net-exports will likely subtract less than in the previous quarters of 2019.