A larger trade surplus can be a positive sign for U.S.
Later this morning we get new trade numbers. We know it’ll be a deficit, but how much? Lately, it’s been going up — the previous monthly numbers showed the U.S. trade deficit hit a seven-month high. Imports outran exports by more than $48 billion.
Now, monthly numbers wobble around, but the general trend the last three years is up. International investment strategist Paul Christopher at Wells Fargo says customers abroad, especially in weak Europe, are buying less of our stuff.
“It’s just a lot of agricultural products, a lot of chemical products, and a lot of very sophisticated electronics,” Christopher says. “Those are the things the world demands when the world is growing.”
Conversely, things are picking up at home. Americans lately have shelled out for foreign cars and foreign consumer goods — cellphones, medicines, clothes.
“As long as consumers and businesses are buying more and those import numbers are looking healthy,” Christopher says, “that’s also sign the U.S. economy is also going to be growing a bit.”
Of course the trade deficit is a bit of an ink blot test — different people see different things. But in the short term, rising imports reflect a rejuvenated American consumer.
Stories You Might Like
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
