US goods trade’s advance report for February indicated that goods deficit widened around USD 636 million, according to Societe Generale. After adjusting for certain differences between final reports and the advance, the overall trade deficit is expected to have widened by around USD 1 billion to USD 46.5 billion, added Societe Generale.
“If our forecast is correct, it would leave the average Q1 trade deficit about $18 billion wider (annualized) versus Q4, leaving a modest drag from trade on growth in the first quarter”, noted Societe Generale.
Meanwhile, strong regional Fed service sector survey suggests that the ISM non-manufacturing composite is expected to have increased.
“We expect the index to bounce to 54.6 in March, putting a halt to a four month slide”, says Societe Generale.
It added that the service sector is not expected to get back its levels witnessed in mid-2015; however, the index is likely to be stable in expansionary territory.
