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Highlights
In November, the U.S. trade deficit widened sharply due largely to a jump in oil imports but also due to a dip in exports. The trade gap grew to $47.8 billion from $43.3 billion in October (originally $43.5 billion). The latest shortfall was much more negative than the consensus forecast for $45.0 billion. Exports declined 0.9 percent after dipping 0.7 percent in October. Imports rebounded 1.3 percent in November, following a 1.0 percent decline the prior month.
The worsening in the trade gap was led by the petroleum gap which expanded to $27.6 billion from $24.2 billion in October. The nonpetroleum goods deficit widened to $34.8 billion from $33.2 billion the month before. Several factors were behind this, including a drop in exports of nonmonetary gold and a boost in automotive imports. The services surplus was slightly improved at $15.4 billion from $15.3 billion in October.
On a not seasonally adjusted basis, the November figures show surpluses, in billions of dollars, in part with Hong Kong $3.2 ($3.0 for October), Australia $1.5 ($2.1), and Singapore $1.0 ($1.0). Deficits were recorded, in billions of dollars, in part with China $26.9 ($28.1), the European Union $9.7 ($8.0),OPEC $9.1 ($8.3), Japan $6.2 ($6.2), Mexico $5.5 ($5.3), Germany $4.7 ($4.3), and Canada $3.0 ($2.2).
Today's report is moderately complex. You cannot attribute the huge worsening to any one fact. Due to special factors, it is very likely that the November number will be partially reversed soon and significantly. Exports of nonmonetary gold have been volatile recently. The surge in oil imports cannot continue at that pace. And the jump in auto imports probably was just American auto companies taking delivery of production in Canadian facilities outside of Detroit. So, economists will be shaving their forecasts for fourth quarter GDP but underlying trends appear to be changed only very slightly with weakness in exports to Europe likely real but not that significant.
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