US Trade Deficit Drops To $39 Billion, Lowest Since December 2013 As Imports, Exports Decline

Tyler Durden's picture

Those waiting to see if the crude crash would lead to any sizable adverse impact on the US trade deficit in November, as lower production led to higher imports if only on paper, the answer is yes, but in the opposite direction: instead of increasing or dropping just marginally from October's $43.4 billion (to the $42 billion consensus estimate), the November trade deficit tumbled by 7.7% to $39 billion the lowest print since December 2013, as a result of a 2.2% drop in imports coupled with a 1% decline in exports. But it was shale crude once again that was the swing factor, which was massively produced as domestic producers scramble to offset declining prices with extra volume, because as the data showed, in November the US imported the smallest crude amount by notional since 1994, and the lowest cost crude since 2010.

And while this will boost GDP marginally now based on beancounter models, it means that in the coming months, as the peak shale production is exhausted and as capacity goes offline first slowly then fast, the deficit is once again set to surge as US shale production goes dark and the US is once again forced to import more crude from abroad, thus boosting the deficit, and leading to a GDP decline.

 

 

Excluding the swing impact of crude,the US non-petroleum trade balance remained near record wides, printing at $46.6 billion in November.

 

The other details from the report:

The U.S. monthly international trade deficit decreased in November 2014 according to the U.S. Bureau of Economic Analysis and the U.S. Census Bureau. The deficit decreased from $42.2 billion in October (revised) to $39.0 billion in November, as imports decreased more than exports. The previously published October deficit was $43.4 billion. The goods deficit decreased $3.3 billion from October to $58.3 billion in November. The services surplus decreased $0.1 billion from October to $19.3 billion in November.

Exports of goods and services decreased $2.0 billion in November to $196.4 billion, mostly reflecting a decrease in exports of goods. Exports of services also decreased.

  • The decrease in exports of goods was more than accounted for by a decrease in capital goods. An increase in industrial supplies and materials was partly offsetting.
  • The decrease in exports of services mostly reflected a decrease in transport, which includes freight and port services and passenger fares.

Imports of goods and services decreased $5.2 billion in November to $235.4 billion, reflecting a decrease in imports of goods. Imports of services were nearly unchanged.

  • The decrease in imports of goods mostly reflected a decrease in industrial supplies and materials.
  • Imports of services were nearly unchanged as a decrease in travel (for all purposes including education) was mostly offset by small increases in several other categories.

Goods by geographic area (seasonally adjusted, Census basis)

  • The goods deficit with Canada decreased from $2.7 billion in October (revised) to $1.4 billion in November. Exports were nearly unchanged at $26.7 billion and imports decreased $1.3 billion to $28.1 billion.
  • The goods surplus with South and Central America increased from $2.3 billion in October to $4.3 billion in November. Exports increased $0.5 billion to $15.5 billion and imports decreased $1.5 billion to $11.2 billion.
  • The goods deficit with the European Union increased from $11.2 billion in October to $12.7 billion in November. Exports decreased $0.7 billion to $22.2 billion and imports increased $0.8 billion to $35.0 billion.

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knukles's picture

Hah ha ha ha ha ha ha
Oh, the oil price decline was supposed to decrease imports and increase exports.

Fucking awful, this is!
Now, were'd anybody get the idea that everything was all good?   Hmmmmm?

Winston of Oceania's picture

Actually exports fell only half that of imports so it was a gain for exports as measured by GDP.

SheepDog-One's picture

More made up 'data' in Free Money Land.

DeadFred's picture

We'll see today if it works once again. Yesterday broke support and dropped as it should until it hit something, maybe the fib retracement of the Bullard ramp? We rose this morning back to kiss the support line and now settled back. If it goes above the overnight highs today we will see another rally. If not the down trend channel is intact.

youngman's picture

Less business..means less jobs needed.....

buzzsaw99's picture

a mere $0.5T per year pace which will eventually forced to buy bullshit stocks. BULLISH!

Clint Liquor's picture

Or Gold. Stocks are nothing more than paper. The world is awash in US paper.

Hohum's picture

Imports up year over year the last two weeks.  So we'll see if this holds:

 

http://ir.eia.gov/wpsr/wpsrsummary.pdf

oklaboy's picture

so the next leg down starts when?

bid the soldiers shoot's picture

It's clear to me and some of my fellow fops (Friends of Putin) that while the US has shot itself massively in the foot, Europe is is receiving 'last rites'.  

Putin, Lavrov, Medvedev and the rest of the chorus of the Kremlin were dead right: sanctions on Russia were going to hurt Europe more than they would hurt Russia.

Nobody expects Oblunder to admit the Russian sanctions were a mistake.  The propaganda machine would never permit it.  Instead of Europe's troubles, Russia's troubles are drummed into us.

The lie is that Europe's troubles are the reason the price of oil has plummeted.  It hurts Russia.

Don't believe it. Don't fall for " 1) Europe's economies are fine.  and 2) The West has got to adjust to the wonderful newss that we have more oil we than we can use."

Meanwhile the Saudi's are offering discounts on top of discounts to Northwestern  Europe and to the US because their economies are in such good shape.

And Stanley Fischer's strong dollar, froze American exports as too expensive and gave the US the currency ammunition to buy all of the exports our allies in Europe were selling, which was undoubtedly the Vice-Chairman's plan.

Fischer's strong dollar plan was for the US to take its strong dollar and import enough European exports, (priced in currently weak pounds and euros) to jumpstart their economies. but that hasn't happened yet.