US Q3 GDP tracking estimate rises to 1.5% after August trade data

US nominal trade deficit widened to $48.3bn in August. The July deficit was little-revised in nominal terms ($41.8bn, initial: $41.9bn) such that the August data represent a $6.5bn widening on the month. 

Exports were down 2.0% m/m, with a sharp decline in goods exports (-3.2% m/m) partially offset by better services exports (0.6% m/m). Imports were up 1.2% m/m with goods imports growing 1.3% m/m and services imports up 0.7% m/m (previously: 0.6%).

"These trends to result in an advance estimate of Q3 GDP that shows strong growth in private consumption and solid fixed business investment, partially offset by a drag from net trade and less inventory stocking", says Barclays.

The data are consistent with strong domestic consumption and investment and a softening in international demand. Robust growth in consumer goods and capital goods imports suggests better consumer and business demand, while weaker exports of many categories of manufactured goods indicate slowing growth on the part of many emerging markets. 

"The revised data on real goods imports and exports through August suggest a more modest drag from net trade for Q3 (-0.8pp) than previously expected. Elsewhere, detailed commodity-level trade data for August modestly boosted the estimate of equipment investment. On net, US Q3 GDP tracking estimate rose three-tenths to 1.5%", added Barclays.