Tag: manufactured goods exports

Global Manufacturing Economic Update – February 13, 2015

Here are the files for this month’s Global Manufacturing Economic Update:

Let’s start with some good news. U.S.-manufactured goods exports reached an all-time high in 2014, surpassing $1.4 trillion for the first time, according to Trade Stats Express. Moreover, goods exports from manufacturers grew 1.9 percent in 2014, with exports to the top five markets higher for the year. At the same time, export growth decelerated from the 5.8 percent and 2.6 percent rates of 2012 and 2013, respectively. Sluggish growth abroad and a strengthened U.S. dollar continue to challenge demand. In December, the U.S. trade deficit widened to its highest level of 2014, and the average monthly deficit for the year exceeded that of 2013 ($42.09 billion per month versus $39.70 billion, respectively). (continue reading…)

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Monday Economic Report – February 9, 2015

Here is the summary for this week’s Monday Economic Report: 

Manufacturers in the United States have added roughly 18,800 workers per month on average over the past 13 months, with an average of 29,000 from October through January. This suggests that the momentum in demand and production in the second half of 2014 has led to an uptick in hiring, which is encouraging. Income growth was also higher, with average weekly earnings up 2.0 percent year-over-year in January. At the same time, the larger economy has also seen strong growth, with nonfarm payrolls increasing by nearly 260,000 per month since the end of 2013. The unemployment rate edged up to 5.7 percent, however, as more Americans re-entered the labor force looking for work. The participation rate rose from 62.7 percent to 62.9 percent. (continue reading…)

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U.S. Trade Deficit Increased in December to its Highest Level of 2014

The Bureau of Economic Analysis and the Census Bureau said that the U.S. trade deficit rose to its highest level of 2014, up from $39.75 billion in November to $46.56 billion in December. The trade deficit averaged $42.09 billion per month in 2014, an increase from the $39.70 billion average of 2013. Goods exports were higher in the second half of 2014 ($137.51 billion each month on average) than in the first half ($135.01 billion), which was positive; however, goods imports also increased (up from an average of $196.59 billion to $198.73 billion). (continue reading…)

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U.S. Trade Deficit Narrowed in November; Oil Imports at Lowest Level Since 1994

The Bureau of Economic Analysis and the Census Bureau said that the U.S. trade deficit fell to its lowest level of 2014, down from $42.25 billion in October to $39.00 billion in November. The trade deficit’s decline, however, stemmed from reduced trade in goods in November. The decrease in goods imports (down from $200.19 billion to $195.01 billion) simply outpaced the decline in goods exports (down from $138.58 billion to $136.73 billion). Meanwhile, the service sector trade surplus narrowed marginally (down from $19.36 billion to $19.28 billion).

Petroleum trade flows helped to explain at least part of the decline in the November trade deficit. Petroleum exports increased from $7.17 billion to $8.27 billion; whereas, petroleum imports dropped from $16.87 billion to $15.84 billion. The Census Bureau said that the 188.87 million barrels of crude oil imported in November was the lowest level since February 1994, illustrating the changing dynamics that have come from the U.S.’s renewed energy abundance. It was also likely influenced by sharply lower crude oil prices. (continue reading…)

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U.S. Trade Deficit Edged Marginally Lower in October

The Bureau of Economic Analysis and the Census Bureau said that the U.S. trade deficit edged marginally lower, down from $43.60 billion in September to $43.43 billion in October. The increase in goods exports (up from $136.04 billion to $138.05 billion) essentially matched the gain in goods imports (up from $198.74 billion to $200.72 billion), with the service sector goods surplus rising from $19.10 billion to $19.24 billion.

Petroleum exports have fallen from $14.13 billion in August to $10.98 billion in October. Much of this decline can be explained by lower crude oil costs. Interestingly, however, petroleum imports have declined by less, down from $27.26 billion in August to $26.22 billion in October. As a result, the petroleum trade deficit has risen from $13.13 billion in August to $15.24 billion in October, its highest point in five months. (continue reading…)

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Monday Economic Report – November 10, 2014

Here is the summary for this week’s Monday Economic Report: 

yoy manufacturing sector employment - nov2014Last week, we received a number of encouraging reports on the state of the manufacturing sector and the U.S. economy. The Institute for Supply Management reported that its manufacturing Purchasing Managers’ Index (PMI) rebounded, up from 56.6 in September to 59.0 in October. This brought the index back up to where it was in August, with both readings at their highest levels since March 2011. This suggests that the manufacturing sector was making healthy gains as we began the fourth quarter, and as further evidence, demand and production were both higher in October. In fact, the new orders and output indices have now been 60 or greater for six straight months. Hiring also picked up. (continue reading…)

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U.S. Trade Deficit Widened Somewhat in September on Reduced Exports

The Bureau of Economic Analysis and the Census Bureau said that the U.S. trade deficit widened somewhat, up from $39.99 billion in August to $43.03 billion in September. This was the highest deficit since May, and it mainly resulted from fewer goods exports (down from $138.65 billion to $136.07 billion). Service-sector exports were also off slightly, down from $59.92 billion to $59.51 billion. In contrast, imports of goods and services were little changed. (continue reading…)

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The U.S. Economy Grew 3.5 Percent in the Third Quarter

The Bureau of Economic Analysis said that real GDP grew an annualized 3.5 percent in the third quarter, slightly higher than my forecast of 3.25 percent. This followed a decline of 2.1 percent in real GDP in the first quarter and a gain of 4.6 percent in the second quarter. As such, the U.S. economy grew a frustratingly slow 1.2 percent at the annual rate in the first half of 2014, which was a major disappointment. Still, consumer and business spending strengthened in the second quarter, and we continued to see gains in these areas in the third quarter, albeit with some easing in the pace of growth. In addition, after seeing net exports serve as a drag toward growth in the first half of the year, they were a positive contributor this time around, which was encouraging. (continue reading…)

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Monday Economic Report – September 8, 2014

Here is the summary for this week’s Monday Economic Report: 

The U.S. economy added 142,000 nonfarm payroll workers in August, a disappointing figure given signs of a rebound in many other indicators lately. The consensus expectation had been for nonfarm payroll growth to exceed 200,000 jobs for the seventh consecutive month, as was observed in the estimates provided by ADP the day before. Manufacturing employment was flat for the month, which was also a disappointment. It ended a 12-month streak of job gains for the sector, a period in which manufacturers added 168,000 net new workers. Hopefully, the August jobs report was just a brief pause in what otherwise had been positive news on the labor front.

The Institute for Supply Management’s (ISM) purchasing managers’ index (PMI) data provides much encouragement that manufacturing activity is moving in the right direction heading into the autumn months. The headline PMI figure rose from 57.1 in July to 59.0 in August, its highest level since March 2011, and it reflected a robust recovery from weaknesses earlier in the year. Indeed, new orders and production expanded at healthy paces. These findings mirror the latest NAM/IndustryWeek Survey of Manufacturers, which is being released this morning, showing respondents mostly upbeat about their own company’s outlook, with sales, capital spending and hiring expectations at two-year highs. Indeed, 87.3 percent of those taking the survey were either somewhat or very positive in their outlook, up from 85.9 percent three months ago. The data are largely consistent with 3.1 percent growth in manufacturing production over the next two quarters.

Manufacturers spent 4.4 percent more on construction projects in July, also providing some reassuring news. The sector has devoted 23.9 percent more to construction projects over the past 12 months, an indication that the increase in demand and output observed over that time frame has resulted in a jump in new investments. Meanwhile, new factory orders data provided mixed news. While orders increased by a whopping 10.5 percent in July, much of that stemmed from highly volatile nondefense aircraft sales. Excluding transportation orders, new factory orders declined 0.8 percent for the month, a finding that we had noted in the earlier release of preliminary durable goods data. Still, factory orders excluding transportation have risen 2.7 percent over the past six months (since weather-related declines in January), which mostly mirrors the more positive data in other releases.

Looking at exports, the U.S. trade deficit narrowed ever-so-slightly in July, with an increase in goods exports marginally offsetting an increase in goods imports. Yet, manufactured goods exports have risen only slightly year-to-date, up just 0.8 percent so far in 2014 using non-seasonally adjusted data. On the other hand, these same figures show that exports to our top five exports markets were higher through the first seven months of this year relative to last year. Regardless, manufacturers hope that the pace of export growth accelerates, with sluggish sales frustrating business leaders and net export growth providing a drag on real GDP over the past two quarters.

This week, we will get new data on consumer confidence, job openings, retail sales and small business optimism. Markets will also continue to digest Friday’s employment numbers, trying to decipher if they were an aberration or a sign of larger weaknesses. In particular, this discussion centers on how the Federal Reserve will interpret such things, with a debate already ongoing as to when the Federal Open Market Committee will begin to increase short-term interest rates. Conventional wisdom holds that short-term interest rates will rise sometime in 2015, but whether that occurs earlier or later in the year is up for debate between those who are more hawkish or dovish on inflation. In the Beige Book, which was released last Wednesday, the Fed mostly observed progress in the economy in recent months, including in manufacturing. Yet, as long as the Fed continues to see “slack” in the labor market, it might be less willing to normalize rates.

Chad Moutray is the chief economist, National Association of Manufacturers. 
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U.S. Trade Deficit Narrowed Ever-So-Slightly in July

The Bureau of Economic Analysis and the Census Bureau said that the U.S. trade deficit narrowed ever-so-slightly, down from $40.81 billion in June to $40.55 billion in July. This was the smallest trade deficit since January’s $39.18 billion level. The smaller July figure stemmed from higher goods exports (up from $136.82 billion to $138.57 billion) that were enough to offset an increase in goods imports (up from $197.23 billion to $198.77 billion). The service-sector trade surplus also widened marginally (up from $19.60 billion to $19.65 billion).

While the deficit was little changed for the month, the breakouts show that the increases in goods exports and goods imports resulted from both petroleum and non-petroleum trade flows. For instance, petroleum exports increased $1.12 billion in July, with non-petroleum exports up by $937 million. Similarly, petroleum imports rose by $915 million, and non-petroleum imports increased by $714 million.

Digging even deeper into the data, there were increased goods exports observed in the automotive vehicles and parts (up $1.66 billion), industrial products and materials (up $1.26 billion) and non-automotive capital goods (up $427 million) sectors. Most of the gain in industrial products and materials came from petroleum. In contrast, exports were lower for consumer goods (down $650 million) and foods, feeds and beverages (down $632 million).

Goods exports to our top 5 export markets for U.S.-manufactured goods were higher through the first seven months of this year relative to the same time frame last year. This included (using non-seasonally adjusted data):

  • Canada (up from $174.66 billion to $180.62 billion)
  • Mexico (up from $130.31 billion to $139.10 billion)
  • China (up from $63.69 billion to $67.96 billion)
  • Japan (up from $37.41 billion to $38.76 billion)
  • Germany (up from $27.38 billion to $29.41 billion)

That is encouraging news, particularly given recent weaknesses in growing export sales. Overall, manufactured goods exports have increased from $684.84 billion year-to-date in 2013 to $690.41 billion in 2014 (non-seasonally adjusted). This represents an increase of just 0.8 percent from last year, which would be a deceleration from last year’s 2.4 percent pace. Note, however, that seasonally adjusted data on Trade Stats Express show a somewhat better rate for the first half of 2014, with 1.7 percent growth through the first two quarters of the year.

Chad Moutray is the chief economist, National Association of Manufacturers. 

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