Improving Trade Deficit A Sign of Improving Economy?
For June, the United States international trade deficit in goods and services decreased significantly from $48B in May to $42.9B in June. Imports decreased to $227.9 billion in June from $231.4 billion in May while exports increased to $185.0 billion in June from $183.3 billion in May. The level of exports was at its highest ever.
So what does this mean? According to the Wall Street Journal, the decrease in the trade deficit is a sign of a stronger domestic economy and will reflect positively on the second quarter GDP. UniCredit economist Harm Bandholz stated that the numbers show that the U.S. economy is relatively unaffected by the overall weak global economy and could add more than 50 basis points to second quarter GDP growth figures.