February 10, 2020

2019 U.S. Trade Deficit Was Country’s Lowest Since 2014


  • The overall U.S. trade deficit was $48.9 billion in December 2019, up $5.2 billion from $43.7 billion in November. The increase reflected an increase in the goods deficit of $5.1 billion to $69.7 billion and a decrease in the services surplus of $0.1 billion to $20.8 billion. The report also had good news: for 2019, the goods and services deficit decreased $10.9 billion, or 1.7 percent, from 2018. Additionally, the U.S.-China goods deficit in 2019 totaled $345.6 billion, its lowest level since 2014. The U.S. trade deficit with the European Union increased 5.7 percent in 2019 to a record $178 billion, however, and, according to Politico, 20 of the 25 countries where the U.S. ran the largest trade deficits in 2018 showed an increase in 2019. Those countries were Mexico, Japan, Vietnam, Ireland, Italy, Malaysia, Canada, Switzerland, India, Taiwan, South Korea, Thailand, France, Russia, Indonesia, Denmark, Sweden, and Cambodia.
  • As The Wall Street Journal explains, Canada’s total trade deficit with the rest of the world in December was C$1.7 billion, down from C$2.68 billion in November. The nation’s merchandise trade deficit with the rest of the world was C$370 million in December, down from C$1.2 billion in November. Canadian exports of goods rose 1.9 percent in December while imports of goods increased only 0.2 percent. Exports of metal and nonmetallic minerals products were down 10.2 percent.
  • The U.S. economy added 225,000 jobs in January, more than analysts had expected. The manufacturing industry lost 12,000 jobs, however. The nation’s jobless rate increased slightly, to 3.6 percent, as more individuals re-entered the workforce. In other jobs-related news: the number of individuals who continued to receive federal unemployment benefits rose during the week that ended January 25, 2020.
  • The Canadian economy added 34,500 net new jobs in January, according to Statistics Canada, while the nation’s unemployment rate fell to 5.5 percent from 5.6 percent the month before. Analysts had predicted a gain of 15,000 jobs for the month. Average hourly earnings also improved, rising 4.2 percent from January 2019 to January 2020.
  • New orders for manufactured goods in the United States increased 1.8 percent in December. Shipments rose 0.5 percent while the value of unfilled orders decreased $0.6 billion. The unfilled orders-to-shipments ratio was 6.65, down from 6.66 in November. Inventories rose 0.5 percent to $704.9 billion and the inventories-to-shipments ratio was 1.40, unchanged from November.
  • The Institute for Supply Management’s purchasing managers’ index (PMI) rose 3.1 points to 50.9 in January. It is the first time since July 2019 that the index has been above the 50.0 mark that indicates expansion.
  • In other economic news: nonfarm business sector labor productivity in the United States increased 1.4 percent in the fourth quarter of 2019 as output increased 2.5 percent and hours worked increased 1.1 percent; U.S. construction spending fell 0.2 percent from November 2019 to December 2019, but increased five percent from December 2018 to December 2019.