This Week’s Top Economic Data Points: U.S. Trade Deficit Improves While Canada’s Widens
- The U.S. trade deficit fell to $43.6 billion in June 2017, down from $46.4 billion in May. Exports in June rose $2.4 billion while imports that month fell $0.4 billion. Year-over-year, the total trade deficit was up 10.7 percent, or $26.7 billion, from June 2016. The goods-only deficit fell to $65.2 billion in June 2017 from $67.3 billion in May 2017.
- Canada’s trade deficit widened to C$3.6 billion in June due in large part to a 4.3 percent drop in the value of exports. According to Reuters, “The drop was widespread, led by a decrease in metal products, crude oil and bitumen.” Canada’s trade surplus with the United States fell to C$2.17 billion due to a 4.5 percent decline in oil shipments.
- The U.S. economy added 209,000 jobs in July while the nation’s unemployment rate fell to 4.3 percent from 4.4 percent in June. Manufacturers added 16,000 last month. In other U.S. employment news: the Labor Department announced that 240,000 individuals filed for federal unemployment benefits for the first time during the week that ended July 29, down from 245,000 the week before. The four-week moving average of first-time claims also fell while the number of individuals who continued to receive jobless benefits rose to 1.968 million during the week that ended July 22 from 1.965 million the week before. The four-week moving average also rose.
- The Canadian economy added 10,900 jobs in July, the eighth month in a row that employment has increased. The nation’s jobless rate also declined, dropping from 6.5 percent in June to 6.3 percent in July, and is now at its lowest level since October 2008.
- New orders for manufactured goods in the United States rose three percent from May 2017 to June 2017 while shipments fell 0.2 percent. The number of unfilled orders rose 1.3 percent and the orders-to-shipments ratio increased to 6.83 from 6.74. Inventories also improved, rising 0.2 percent, while the inventories-to-shipments ratio was 1.38, up from 1.37 in May.
- The IHS purchasing managers’ index (PMI) for the United States rose to 53.3 in July from 52.0 in June due to an increase in production. The IHS PMI is now at a four-month high. The Institute for Supply Management’s PMI for the United States fell, meanwhile, to 56.3 in July from 57.8 in June because of declines in production and employment.
- The Markit PMI for Canada increased to 55.5 in July from 54.7 in June due to an increase in output and higher rates of employment.
- The Federal Reserve Bank of Dallas announced last week that its manufacturing survey rose to +16.8 in July from +15.0 in June due to higher rates of new orders, production, and employment.
- In other economic news: auto sales in Canada increased 4.9 percent between July 2016 and July 2017 while year-over-year sales in the United States fell; construction spending in the United States fell 1.3 percent from May 2017 to June 2017, but increased 1.6 percent between June 2016 and June 2017; and personal incomes in the United States fell 0.1 percent from May to June.