U.S. Trade Deficit Grows 4.4% to All-Time High of $68.9 Billion:
New Monthly Record With China

U.S. Census Bureau / U.S. Department of Commerce 14dec2005

[Further detail: www.census.gov/foreign-trade/Press-Release/current_press_release/press.html 14dec2005]

The Nation’s international deficit in goods and services increased to $68.9 billion in October from $66.0 billion (revised) in September, as imports increased more than exports.

Goods and Services

• Exports increased to $107.5 billion in October from $105.8 billion in September. Goods were $75.2 billion in October, up from $73.5 billion in September, and services were virtually unchanged at $32.3 billion.
• Imports increased to $176.4 billion in October from $171.8 billion in September. Goods were $149.1 billion in October, up from $144.8 billion in September, and services were $27.3 billion in October, up from $27.0 billion in September.
• For goods, the deficit was $73.9 billion in October, up from $71.3 billion in September. For services, the surplus was $5.0 billion in October, down from $5.3 billion in September.

Goods by Category

• The September to October change in exports of goods reflected increases in capital goods ($1.8 billion); foods, feeds, and beverages ($0.2 billion); automotive vehicles, parts, and engines ($0.2 billion); industrial supplies and materials ($0.1 billion); and other goods ($0.1 billion). A decrease occurred in consumer goods ($0.6 billion).
• The September to October change in imports of goods reflected increases in industrial supplies and materials ($3.5 billion); automotive vehicles, parts, and engines ($0.8 billion); and consumer goods ($0.4 billion). Decreases occurred in foods, feeds, and beverages ($0.2 billion); other goods ($0.1 billion); and capital goods ($0.1 billion).

Services by Category

• The September to October change in exports of services reflected decreases in travel ($0.1 billion) and transfers under U.S. military sales contracts ($0.1 billion), which were partly offset by an increase in other private services ($0.1 billion).
• The September to October change in imports of services mostly reflected increases in other transportation ($0.2 billion) and other private services ($0.1 billion).

Goods by Geographic Area (Not Seasonally Adjusted)

• The goods deficit with China increased from $20.1 billion in September to $20.5 billion in October. Exports increased $0.7 billion (primarily soybeans and civilian aircraft) to $3.9 billion, while imports increased $1.1 billion (primarily TV’s and VCR’s; toys, games, and sporting goods; and computers) to $24.4 billion.
• The goods deficit with the European Union increased from $10.1 billion in September to $12.1 billion in October. Exports increased $1.2 billion (primarily civilian aircraft, nuts, and agricultural farming products) to $16.0 billion, while imports increased $3.2 billion (primarily passenger cars; petroleum products; pharmaceutical preparations; and artwork, antiques, and stamps) to $28.1 billion.
• The goods deficit with Japan increased from $6.4 billion in September to $7.4 billion in October. Exports increased $0.4 billion (primarily civilian aircraft) to $4.9 billion, while imports increased $1.4 billion (primarily automotive vehicles, parts, and engines; and other industrial machines) to $12.2 billion.

This and more information is provided in the Bureau of the Census and Bureau of Economic Analysis press release:

U.S.International Trade in Goods and Services: October 2005 . This and more information is provided in the U.S. Census Bureau and U.S. Bureau of Economic Analysis press release, U.S. International Trade in Goods and Services: June 2005. For further information on goods, contact Vanessa Ware, Foreign Trade Division, U.S. Census Bureau, on (301) 763-2311; on services, contact Christopher Bach, U.S. Bureau of Economic Analysis, on (202) 606-9545.

NOTE: Total goods data are reported on a Balance of Payments basis; commodity and country detail data for goods are on a Census basis. For information on data sources and definitions, see the information section on page 26 of the FT-900 release, or at www.census.gov/ft900 or www.bea.gov/bea/di/home/trade.htm. The next release is Thursday, January 12, 2005

Note: Total goods data are reported on a Balance of Payments basis; commodity and country detail data for goods are on a Census basis. For information on data sources and definitions, see the Information Section (PDF, 53k) (TXT, 23k)

source: http://www.census.gov/indicator/www/ustrade.html 14dec2005

Monthly Trade Highlights

US Census Bureau 14dec2005

October 2005 Highlights

This page shows the Balance, Exports and Imports for the current month and prior month, along with the percent change and dollar change between the two. The last column of the table shows the last time the percent change (or dollar change) was larger. Some interesting facts about this month's International Trade in Goods and Services report can be found at the bottom of the page.

Goods and Services on a Balance of Payments (BOP) Basis, seasonally adjusted - series began with January 1992 statistics.

All Values in billions of dollars

Percent Change from Prior Month

					  Percent Change
	October 2005	 September 2005	  from           Last time the Increase/Decrease in Percent Change
	(Billions of $)  (Billions of $)  Prior Month    was larger/When it Occurred
Goods and Services
Balance	  -$68.9 	-$66.0 		  -4.4% 	 -11.9% from August 2005 to September 2005 
Exports   $107.5 	$105.8 		   1.7% 	   2.8% from March 2005 to April 2005 
Imports   $176.4 	$171.8 		   2.7% 	   4.3% from March 2005 to April 2005 

Goods (BOP Basis)
Balance   -$73.9 	-$71.3 		  -3.6% 	 -11.3% from August 2005 to September 2005 
Exports    $75.2 	 $73.5 		   2.4% 	   4.2% from March 2005 to April 2005 
Imports   $149.1 	$144.8 		   3.0% 	   4.9% from March 2005 to April 2005

Dollar Change From Prior Month

					  Dollar Change
	October 2005	 September 2005	  from           Last time the Increase/Decrease in Percent Change
	(Billions of $)  (Billions of $)  Prior Month    was larger/When it Occurred
Goods and Services
Balance   -$68.9 	 -$66.0		  -$2.9 	 -$7.0 from August 2005 to September 2005 
Exports   $107.5 	 $105.8		   $1.8 	  $2.9 from March 2005 to April 2005 
Imports   $176.4 	 $171.8 	   $4.7 	  $6.8 from March 2005 to April 2005 

Goods (BOP Basis) 
Balance   -$73.9 	 -$71.3 	  -$2.6 	 -$7.3 from August 2005 to September 2005 
Exports    $75.2 	  $73.5 	   $1.8 	  $3.0 from March 2005 to April 2005 
Imports   $149.1 	 $144.8 	   $4.3 	  $6.4 from March 2005 to April 2005

• The October goods and services deficit ($68.9 billion) and the October goods deficit ($73.9 billion) were records.
• October imports of goods and services ($176.4 billion) and October imports of goods ($149.1 billion) were records.
• October imports of services ($27.3 billion) were a record.
• October exports of goods and services ($107.5 billion) and October exports of goods ($75.2 billion) were the second highest on record.

Goods on a Census Basis (seasonally adjusted)

Deficit

• The October deficit ($72.5 billion) was a record.
• The October petroleum deficit ($24.3 billion) and non-petroleum deficit ($48.3 billion) were records.

Exports

• October exports of $76.3 billion were the second highest on record. The record occurred in August 2005 ($77.9 billion).
• October exports of automotive vehicles, parts, and engines ($8.5 billion) were a record.

Imports

• October imports of $148.8 billion were a record.
• October industrial supplies and materials ($50.6 billion) and automotive vehicles, parts, and engines ($20.9 billion) were records.
• October imports of petroleum ($25.8 billion) and non-petroleum ($123.0 billion) were records.

Country and other highlights (Census Basis, not seasonally adjusted)

• The October deficit with Canada ($8.1 billion) and October imports from Canada ($26.9 billion) were records.
• The October deficit with Mexico ($4.8 billion) was a record.
• October exports to Mexico ($10.9 billion) and October imports from Mexico ($15.7 billion) were records.
• The October deficit with the European Union ($12.1 billion) and October imports from the European Union ($28.1 billion) were records.
• The October deficit with China ($20.5 billion) was a record.
• October exports to China ($3.9 billion) and October imports from China ($24.4 billion) were records.
• October imports from South/Central America ($11.0 billion) were a record.
• The October deficit with OPEC ($9.4 billion) and October imports from OPEC ($12.5 billion) were records.
• October imports of advanced technology products ($23.8 billion) were a record.

Source: FTDWebMaster, Foreign Trade Division, U.S. Census Bureau, Washington, D.C. 20233 Location: MAIN: STATISTICS:TRADE HIGHLIGHTS Created: 14 August 2003 Last modified: 14 December 2005 at 08:35:06 AM

source: http://www.census.gov/foreign-trade/statistics/highlights/monthly.html 14dec2005

US Trade Gap Hits New High at $68.9bn

ADREI POSTELNICO / Financial Times (UK) 14dec2005

New York — The US trade gap reached a new all-time record of $68.9bn in October as surging deficits between the world’s largest economy and its top exporters overshadowed the effect of declining energy prices.

The US commerce department said on Wednesday that the overall deficit expanded by 4.4 per cent in October after it had risen by 11.9 in the prior month.

Meanwhile imports of goods and services advanced by 2.7 per cent to a record of $176.4bn as exports rose by 1.7 per cent to $107.5bn, the second-highest reading.

The expansion of the trade gap hints at weaker than expected economic growth in the fourth quarter and compounded the decline of the dollar to a five-week low against the yen.

Ian Shepherdson, chief US economist at High Frequency Economics, estimated that energy prices accounted for two-thirds of the deficit expansion and noted that a surplus in the aerospace sector was not enough to offset the effect of energy prices.

“The past year’s flat trend in the core deficit [which excludes energy] seems to be breaking,” Mr Shepherdson said.

The volume of crude oil imports jumped by 9.3 per cent to a total value of $17.1bn even as the average price fell to $56.29 per barrel.

The politically-sensitive bilateral trade gap between the US and China grew by 2.1 per cent to a new high of $20.5bn even as textile imports from that country tumbled by 10.9 per cent. In November, the Chinese and US governments struck a deal to limit Chinese textile exports to the US for the next two years.

The US Congress has voiced concern and irritation about the effect of low-cost imports from China on the US economy and Americans’ jobs. It has threatened to impose stiff tariffs on those imports unless Beijing agrees to devalue its currency, thereby making its exports less of a threat to US companies.

source: http://news.ft.com/cms/s/766d39be-6cb8-11da-90c2-0000779e2340.html 14dec2005

U.S. Trade Gap Grew 4.4% As Oil, Gas Imports Soared

Wall Street Journal 14dec2005

The U.S. trade deficit surged 4.4% in October as rising purchases of foreign oil and natural gas helped offset increased exports, while the politically sensitive trade shortfall with China widened to a new monthly record.

The Commerce Department reported Wednesday that the U.S. deficit in international trade of goods and services climbed to a record $68.89 billion from a slightly revised $66.00 billion in September. September's shortfall was previously estimated at $66.11 billion, the previous record high. So far this year, the deficit is running at an annual rate of $718 billion, far surpassing last year's $617.6 billion imbalance.

Imports rose 2.7% to $176.43 billion from $171.77 billion in September, while exports increased 1.7% to $107.55 billion from $105.77 billion. Purchases of industrial materials from overseas climbed $3.54 billion, driven by fuel oil, natural gas and organic chemicals. Consumer goods imports climbed $399 million. U.S. exports of capital goods surged $1.79 billion but consumer-goods exports fell $554 million.

The grim reading on the balance of trade led many economists to mark down their forecasts for fourth-quarter economic growth. Economists at Morgan Stanley wrote in a note that while they expect the deficit to narrow in November and December, "we still see trade making a larger negative contribution to growth, and cut our Q4 GDP estimate to +3.0% from +3.4%."

Also Wednesday, the Labor Department reported that prices of goods imported to the U.S. dropped 1.7% in November, the most in over two-and-a-half years, as petroleum prices continued to slide. That marked the first decline in six months. October import prices were revised to show a 0.3% increase, compared with an initial estimate of a 0.3% decline. At the same time, export prices fell 0.9%, the biggest drop since December 1991.

Oil and Gas Weigh on Trade Balance

Though crude-oil prices actually declined in October, increased shipments meant that energy was again a huge drag on the trade balance. The average price of a barrel of crude slid $1.03 to $56.29 from $57.32, but the volume of oil imports rose to 304.48 million barrels from 278.45 million barrels in September. With the rise in volume, the value of imported crude increased to $17.14 billion from $15.96 billion. In all, the nation bought $26.16 billion of total energy-related petroleum products from international sources during October, higher than September's $23.18 billion.

Meanwhile, a surge of Chinese shipments of televisions, toys and computers pushed the U.S. deficit with China to a new monthly record of $20.52 billion. Through October, the deficit with China is running at an annual rate of $200 billion, far exceeding last year's imbalance of $162 billion, the biggest deficit ever recorded with a single country.

Deficits with other major trading partners also grew. The deficit with Japan expanded to $7.36 billion from $6.41 billion, while the trade gap with the euro area rose to $8.79 billion from $7.24 billion. The deficit with Canada widened to $8.10 billion from $7.38 billion and the shortfall with Mexico grew to $4.79 billion from $4.31 billion.

Autos and parts imports rose by $786 million. Imports of capital goods like computers fell $92 million. Imported foods, feeds and beverages were down by $175 million. Exports of industrial supplies like chemicals and metals increased $59 million. Exports of autos and parts rose by $164 million, and sales of foods, feeds, and beverages went up by $198 million.

Petroleum Prices Continue Slide

The drop in overall import prices in November reflected an 8% fall in prices of petroleum imports, the sharpest drop since December 2004. October petroleum import prices were revised to show a 1.0% decline, compared with the previous estimate of a 4.4% drop.

Non-petroleum import prices fell 0.2% in November, their first drop since July. October non-petroleum import prices were revised to a 0.9% increase from the initially estimated 0.8% rise.

On a year-on-year basis, overall import prices still rose 7% in November. November petroleum import prices were up 30.8% from a year earlier, while non-petroleum import prices were up 2.6% from a year earlier. Prices of goods imported from the European Union fell 0.7% in November. Prices fell 1.1% for goods from both Canada and Mexico. Meanwhile prices for goods from China fell 0.1% and prices for goods from Japan fell 0.2%.

Prices of agricultural exports fell 0.3%, and prices of non-agricultural exports fell 0.9%.