U.S. goods trade balance remains widely unchanged in June

U.S. advance goods trade balance came in at a deficit of USD 74.2 billion in June, widely unchanged relative to May’s revised deficit of USD 75 billion. Exports dropped 2.8 percent on the month while imports dropped 2 percent.

Within exports, there was especially softness in capital goods, automotive vehicles and consumer goods. The fall in consumer goods exports was the largest monthly fall since March 2016, when consumer exports dropped 12.5 percent.

“We view weakness in exports as driven primarily by slower economic momentum in some advanced foreign economies and secondarily by elevated trade policy uncertainty”, said Barclays in a research report.

Imports of industrial supplies dropped 7.2 percent and that of consumer goods dropped 1.4 percent. Capital goods imports dropped modestly 0.5 percent. Trends in these categories are in line with other incoming data that indicate towards a notable deceleration in business sector spending in recent months.

“Altogether, the June trade data suggest that volumes in goods trade slowed in the second quarter, with a solid May offset by weakness in April and June”, said Barclays.

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