Initial Claims Come At 451K On Expectations Of 470K, Trade Deficit Declines From $47 Billion To $42.8 Billion

Futures surge as the US economy continues to hemorrhage jobs: a 451K print in initial jobless claims merely means that ever more people are being shifted over to extended benefits, which increased by 64.7K. One can be sure that at least 20K of this number is those hitting the 6 month ceiling on claim applicability. Also, continuing claims increased by 22K, and came in 28K worse than expected, at 4,478K compared to expectations of 4,450. And yes, anything over 400K means no job creation (private or census), contrary to whatever the DOL may want everyone to believe.

Elsewhere, the US trade deficit for July came out at "only" $42.8 billion on expectations of $47 billion, with the previous print slightly revised to $49.8 billion. We are looking forward to the Chinese release over the weekend of their version of the story, which will show more updated August data, and allow to read into how the China-US trade balance is developing.

More from the Trade Balance report:

Goods and Services

  • Exports increased to $153.3 billion in July from $150.6 billion in June. Goods were $107.7 billion in July, up from $104.9 billion in June, and services were $45.6 billion in July, virtually unchanged from June.

  • Imports decreased to $196.1 billion in July from $200.3 billion in June. Goods were $162.9 billion in July, down from $167.1 billion in June, and services were $33.2 billion in July, virtually unchanged from June.

  • For goods, the deficit was $55.2 billion in July, down from $62.2 billion in June. For services, the surplus was $12.5 billion in July, virtually unchanged from June.

Goods by Category (Census basis)

  • The June to July increase in exports of goods reflected increases in capital goods ($2.3 billion); other goods ($0.5 billion); and industrial supplies and materials ($0.5 billion). A decrease occurred in automotive vehicles, parts, and engines ($0.4 billion). Foods, feeds, and beverages and consumer goods were virtually unchanged.

  • The June to July decrease in imports of goods reflected decreases in consumer goods ($1.9 billion); automotive vehicles, parts, and engines ($0.7 billion); capital goods ($0.6 billion); industrial supplies and materials ($0.4 billion); other goods ($0.3 billion); and foods, feeds, and beverages ($0.1 billion).

Services by Category

  • Exports of services were virtually unchanged from June to July. Decreases in other private services ($0.2 billion), which includes items such as business, professional, and technical services, insurance services, and financial services, and in other transportation ($0.1 billion), which includes freight and port services, were partly offset by an increase in travel ($0.1 billion). Changes in the other categories of services exports were small.

  • Imports of services were virtually unchanged from June to July. A decrease in royalties and license fees ($0.1 billion), which were boosted in June by payments for rights related to the 2010 soccer World Cup, were partly offset by an increase in travel ($0.1 billion). Changes in the other categories of services imports were small.

Goods by Geographic Area (Not Seasonally Adjusted)

  • The goods deficit with Canada decreased from $2.5 billion in June to $1.4 billion in July. Exports decreased $2.6 billion (primarily automobiles, parts, and accessories) to $19.7 billion, while imports decreased $3.7 billion (primarily passenger cars and crude oil) to $21.1 billion.

  • The goods deficit with China decreased from $26.2 billion in June to $25.9 billion in July. Exports increased $0.6 billion (primarily civilian aircraft, engines, equipment, and parts) to $7.3 billion, while imports increased $0.4 billion (primarily toys, games, and sporting goods and apparel) to $33.3 billion.

  • The goods deficit with the European Union increased from $7.8 billion in June to $9.9 billion in July. Exports decreased $1.6 billion (primarily pharmaceutical preparations and civilian aircraft, engines, equipment, and parts) to $18.8 billion, while imports increased $0.5 billion (primarily petroleum products) to $28.7 billion.
This and more information is provided in the Bureau of the Census and Bureau of Economic Analysis press release:
U.S.International Trade in Goods and Services: July 2010 .
For further information on goods, contact Maria Iseman, Foreign Trade Division, U.S. Census Bureau, on (301) 763-2311; on services, contact Edward Dozier, U.S. Bureau of Economic Analysis, on (202) 606-9559.

NOTE: Total goods data are reported on a Balance of Payments basis; commodity and country detail data for goods are on a Census basis. For information on data sources and definitions, see the information section on page A-1 of the FT-900 release, or at www.census.gov/ft900 or http://www.bea.gov/bea/di/home/trade.htm.