The US trade deficit narrowed slightly to USD 54.0 billion in July 2019 from a revised USD 55.5 billion in the previous month and compared to market expectations of USD 53.5 billion. Exports rose 0.6 percent while imports fell 0.1 percent.
Exports from the US rose USD 1.2 billion from the previous month to USD 207.4 billion in July. Goods exports increased USD 1.2 billion to USD 138.2 billion, boosted by sales of consumer goods (up USD 1.5 billion), mainly pharmaceutical preparations; capital goods (up USD 0.8 billion); and automotive vehicles, parts, and engines (up USD 0.6 billion). In contrast, industrial supplies and materials exports decreased USD 1.7 billion on the back of crude oil, metallurgical grade coal, fuel oil, and other petroleum products. Exports of services, including transport and charges for the use of intellectual property, dropped USD 0.1 billion to USD 69.2 billion in July.
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On a non seasonally adjusted basis, goods exports increased to Mexico (7.1 percent) and Japan (5.9 percent), but fell to China (-3.3 percent), the EU (-5.7 percent), Canada (-6.1 percent), and Brazil (-7.9 percent).
Imports to the US declined USD 0.4 billion to USD 261.4 billion. Goods imports fell USD 0.4 billion to USD 211.8 billion due to lower purchases of capital goods (down USD 1.5 billion) led by computers. Meanwhile, industrial supplies and materials imports advanced USD 0.9 billion due to other petroleum products. Imports of services, such as insurance services and other business services, were up USD 0.1 billion to USD 49.6 billion in July.
On a non seasonally adjusted basis, goods imports decreased from Canada (-3.2 percent) and Mexico (-1.3 percent), but were up from China (6.4 percent), the EU (11.0 percent), Japan (8.3 percent), and Brazil (17.5 percent).
The politically sensitive goods trade deficit with China increased 9.4 percent to USD 32.8 billion in July from USD 30.0 billion in June; while that with the EU widened to a record high of USD 20.1 billion from USD 14.0 billion, with the shortfall with Germany the largest since August 2015. Also, the trade deficit rose with Canada (USD 3.5 billion from USD 2.9 billion) and Japan (USD 6.3 billion from USD 5.7 billion), but narrowed with Mexico (USD 8.0 billion from USD 9.9 billion).