U.S., Canadian Trade Deficits Both Narrow
- According to the U.S. Commerce Department, the nation’s goods and services trade deficit was $50.8 billion in April 2019, down $1.1 billion from $51.9 billion the previous month. April exports were $206.8 billion, $4.6 billion less than March exports. April imports were $257.6 billion, $5.7 billion less than March imports. The April decrease in the overall deficit reflected a decrease in the goods deficit of $1 billion to $71.7 billion and an increase in the services surplus of $0.1 billion to $20.9 billion. Year-to-date, the goods and services deficit increased $4.1 billion, or two percent, from the same period in 2018.
- As The Wall Street Journal explains, Canada’s trade deficit narrowed in April, to C$966 million from C$2.34 billion, and is now at its lowest level in six months. Exports increased 1.3 percent in April while imports fell 1.4 percent. Exports of metal and nonmetallic mineral products rose 15 percent in April. Canadian exports to the United States advanced 0.9 percent, but imports rose 1.9 percent.
- According to the U.S. Labor Department, U.S. employers added the fewest workers in three months and wage gains cooled. Payrolls rose 75,000 in May after a downwardly revised 224,000 advance the prior month. Manufacturers added 3,000 jobs. The jobless rate held at a 49-year low of 3.6 percent while average hourly earnings climbed 3.1 percent from a year earlier, less than projected. In other employment-related news: the number of individuals who filed for federal unemployment benefits for the first time rose during the week that ended May 25 while the number of individuals who continued to receive benefits fell during the week of May 18.
- In Canada, employers added 27,700 net new jobs in May and the nation’s jobless rate fell to an all-time low of 5.4 percent. According to Reuters, the number of jobs created was about three times the number that were expected.
- New orders for manufactured goods in the United States fell 0.8 percent in April while shipments fell 0.5 percent. Unfilled orders dropped 0.1 percent and inventories rose 0.3 percent.
- The IHS purchasing managers’ index (PMI) for the United States fell to 50.5 in May, its lowest level since September 2009, from 52.6 in August. New orders in the United States declined for the first time since August 2009. The Institute for Supply Management PMI for the United States, meanwhile, fell to 52.1 in May from 52.8 in April due in part to declines in inventories and production.
- The IHS PMI for Canada fell to 49.1 in May to 49.7 in April and is now at its lowest level in nearly three-and-a-half years. Output contracted at the most marked rate since the end of 2015 due to falling new orders and subdued global trade conditions.
- In other economic news: U.S. construction spending was flat from March 2019 to April 2019, but fell 1.2 percent between April 2018 and April 2019; labor productivity in the United States rose 3.4 percent in the first quarter of the 2019.