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| US trade gap narrows more than expected |
| 2006-01-12 |
| The U.S. trade deficit narrowed more than expected in November to $64.2 billion as shipments of aircraft, cars and other capital goods propelled exports to a new record and lower oil prices helped trim imports, a government report showed on Thursday. The monthly trade gap fell 5.8 percent from the record set in October and was significantly below Wall Street's median forecast of $66.25 billion. October's record deficit was trimmed slightly to $68.1 billion from an initially reported $68.9 billion gap. Separate reports showed new claims for jobless benefits rose less than expected last week, while import prices declined unexpectedly in December. The November trade deficit was still the third highest on record -- behind the tallies for October and September -- and confirmed a new record annual trade deficit, with one month of data yet to come in 2005. The gap for the first 11 months of the year totaled $661.8 billion, surpassing the record of $617.6 billion set in 2004, the Commerce Department said. The dollar strengthened against the euro and the yen in trading after the report, while bond prices trimmed gains. "The improvement in the trade gap is always welcome but the continued high level is always a concern. Strong exports (are) a confirming sign that growth is picking up in the rest of the world," said Alan Gayle, a managing director at Trusco Capital Management in Atlanta. "In general, the twin deficits (trade and federal) will be an ongoing source of volatility in the dollar and interest rates," Gayle said. U.S. exports of goods and services increased 1.8 percent to a record $109.3 billion. Exports of both capital goods and consumer goods set records in November. Analysts had expected strong aircraft exports, after Boeing reported commercial orders had tripled to a new record in 2005. Oil import prices, which had spiked in the wake of Hurricane Katrina in late August, declined further in November to $52.16 per barrel. The volume of crude oil imports increased in November, but the volume of all petroleum-product imports -- which also includes butane and propane -- fell from an unexpectedly strong surge in October. Both factors helped trim imports to $173.5 billion, down 1.1 percent from the record set in October but still the second highest ever. U.S. imports of auto and auto parts set a record in November, as did imports of services. Imports of advanced technology products, which have grown rapidly in recent years, also set a record. Meanwhile, the politically sensitive trade deficit with China narrowed nearly 10 percent in November to $18.5 billion, after rising for seven consecutive months. U.S. exports to China were mostly unchanged at $3.9 billion, while imports fell 8.4 percent to $22.4 billion. A Labor Department report with more up-to-date information showed U.S. import prices fell unexpectedly 0.2 percent in December as the price of imported petroleum declined for the third straight month. A second Labor Department report showed the number of U.S. workers making new claims for unemployment benefits rose 17,000 last week, slightly less than analysts had expected. |
| Posted by:lotp |
| #1 Open up ANWR - the Constitution requires it. Provides for the common defense and general welfare. AND reduces the deficit. Can't complain about the deficit and high energy prices. 1 will take care of the other. |
| Posted by: anonymous2u 2006-01-12 11:31 |