U.S. Trade Deficit, Canadian Surplus Expand

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Meanwhile, here are the major economic headlines from the last week:

• The U.S. the goods and services trade deficit  was $64.3 billion in October, up $3.1 billion from September. October exports were $258.8 billion, $2.6 billion less than September while imports were $323 billion, $0.5 billion more than September. The October increase in the overall trade deficit reflected a $3.5 billion increase in the goods deficit to $89.8 billion and a $0.4 billion increase in the services surplus to $25.5 billion. Year-to-date, the goods and services deficit has fallen $161.4 billion, or 19.8 percent, from the same period in 2022.
• Canada’s merchandise trade surplus increased to $3 billion in October from $1.1 billion in September. Imports fell 2.8 percent to $63 billion, due mostly to a 14.7 drop in imports of metal and non-metallic mineral products and a 5.8 percent decline in motor vehicle and part imports. Exports of goods rose 0.1 percent to $66 billion, meanwhile. That improvement was due mostly to aircraft and transportation equipment and part exports, which rose 15 percent.
• New orders for U.S. manufactured goods fell $21.8 billion, or 3.6 percent, in October to $576.8 billion. Shipments fell 1.4 percent to $577.8 billion while unfilled orders rose 0.3 percent to nearly $1.36 trillion. The unfilled orders-to-shipments ratio was 6.90, up from 6.88 in September. Inventories rose 0.1 percent to $857 billion while the inventories-to-shipments ratio was 1.48, up from 1.46 in September. Read the full report here.
• The capacity utilization rate in the Canadian manufacturing sector rose 0.3 percentage points to 78.3 percent in the third quarter. The increase was driven by the strength of primary metal manufacturing (up 2.2 percentage points) and metal product manufacturing (up 1.3 percentage points).
• S. wholesale inventories declined by 0.4 percent between September 2023 and October 2023 and 2.3 percent from October 2022 and October 2023. Wholesale sales fell 1.3 percent for the month, and were down 0.4 percent year-over-year. Read the full report here.
• U.S. workers’ productivity increased by 5.2 percent in the third quarter, the largest increase since the third quarter of 2020. At the same time, unit labor costs dropped by a seasonally-adjusted 0.8 percent from July to September.
• Total U.S. payroll employment increased by 199,000 jobs in November as the nation’s unemployment rate fell to 3.7 percent. Manufacturing employment increased 28,000 in November, reflecting rises in motor vehicles and parts sector jobs as workers returned from a strike. Employment in manufacturing has shown little net change over the year, however.
• The number of U.S. job openings fell to 8.7 million in October, the lowest level since March 2021. There were 587,000 manufacturing jobs open in October, down from 601,000 the month before. In other employment news: Initial applications for U.S. unemployment benefits rose by about 1,000 to 220,000 during the week that ended December 2. The four-week moving average of first-time claims also increased. Continuing claims fell by 64,000 from the previous week to 1.86 million, marking just the second decline in 11 weeks. Read the full report here.