An
article yesterday titled 'Trade gap widens 15.1% in January' -
reading time 2 minutes - reported that the U.S. trade deficit increased
to U.S.$46.5 billion in January from a (revised) December number of
U.S.$40.3 billion. Analysts apparently had expected a
January trade deficit of U.S.$41.5 billion. The increase
in the trade deficit was attributed to more than the higher price of
imported oil experienced in January. The article quotes
one economist as saying that the latest surge in imported oil prices
will push the U.S. trade deficit to about U.S.$50 billion per month over
the next few months. To me, all of this is evidence of
continuing erosion of the U.S. fiscal position.
Note:
If you read the article you will find it also says that
"excluding the impact of inflation, the deficit in real terms rose 7.5%
to $49.51 billion in January" and that "The trade deficit had added a
whopping 3.4 percentage points to fourth-quarter growth". I
can't make sense of either of these statements as in the case of the
first a nominal (inflation included) number ought always to be higher
than a 'real' number assuming inflation exists. In the
case of the second statement I can only conclude the author means '3.4%
from what it otherwise would have been, if ?'
A
second article yesterday titled 'China reports largest trade deficit in 7
years' - reading time 3 minutes - reported that China ran a
U.S.$7.3 billion trade deficit in Feburary as contrasted to an expect
U.S.$5 billion surplus. Attributed in part to the Chinese
New Year distorting Chinese trade data, this trade deficit number
resulted from a shortfall from expected growth in Chinese exports, and a
lower than expected increase in Chinese imports. As I see
things, this is hardly a 'blip' on the Chinese radar screen and as such
ought to be given no weight pending release of Chinese trade
surplus/deficit numbers over the next few months.