–Imported Oil Px & Vol Jump; Gap W/ China -$26.9b, Japan -$6.2b
By Joseph Plocek
WASHINGTON (MNI) – U.S. November trade data disappointed and might
result in GDP forecasts being marked lower.
The November trade balance was -$47.8 billion after a revised
-$43.3 billion in October.
Imports advanced $2.9 billion in a rebound and exports fell $1.5
billion.
The imports change was almost all related to oil (+$3.2 billion) as
price and volume jumped. In fact, the first price gain in five months
simply took the average unit price per barrel of crude oil up 3.7% to
$102.50, about the mid-point of where it stood in Q3. The gain in volume
was a little under +5% to 27.3 million barrels a day on average, still
its slowest run-rate since last spring.
Also in imports, pharmaceuticals printed -$572 million and civilian
aircraft -$197 million in offsets to the oil gain. Auto and parts
imports posted +$816 million.
The exports drop showed a technical component as well as a dip in
equipment sales.
A total of -$891 million of exports was nonmonetary gold,
accounting for about 60% of the overall decline. This category printed
-$1.2 billion in October and +$1.6 billion in September, also unusually
large swings that offset the most recent movement.
Nonmonetary gold is a commodity that includes gold bricks and
coins, and gold for industrial use (in dentistry, jewelry, computer
chips, and finishings). It is unclear if these moves could be related to
commodities or investment trading, the off-loading or swapping of a
central bank’s holdings to the private sector, or some other industrial
activity that the Commerce Department is picking up now but failed to
capture in the past. But the recent large moves swamp historical norms:
year-to-date exports of nonmonetary gold nearly doubled to $30.5
billion, compared to only $16.1 billion in the similar period last year.
Unadjusted trade gaps by country included: China at -$26.9 billion
after -$28.1 billion in October; Japan -$6.2 billion after -$6.2
billion; and OPEC -$9.1 billion after -$8.3 billion. The gap with
Germany was -$4.7 billion after -$4.3 billion in October, and November’s
gap was the highest since October 2005.
The U.S.-China bilateral trade deficit was -$273.1 billion for all
2010. Year-to-date, this number is -$272.3 billion, so if there is
another -$25 billion gap in December this would imply a new record will
be posted for all 2011.
The real trade balance was -$47.5 billion in November and -$44.1
billion in October, against a -$46 billion Q3 average. Trade may not add
to Q4 growth. This disappointing report might see GDP estimates marked
down, as most economists expected some improvement.
Looking ahead, Mideast tensions might keep oil prices higher,
giving little hope that the U.S. trade gap can close in the immediate
future. A bottom line remains that the U.S. still depends on overseas
production of oil and goods to fill its consumption needs.
**Market News International Washington Bureau: (202)371-2121**
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