Trade gap did not widen as expected. The improvement versus expectations was driven by exports which suggests that global growth is getting better. Of course, total US trade is still down significantly, just under -30 percent across all countries. The US also won a WTO ruling against China which limited sales of US films and music.
The trade improvement was associated with a more competitive dollar which is similar to what we saw in the last years of the Bush Administration, a benign neglect concerning the dollar because there was improvement in the export sector. This is a dangerous game of trying to keep those who buy US debt happy while trying to create jobs in the economy. Global trade has declined much more than GDP around the world. The steep decline is driven in part with inventory management so it would not be unusual to see the trade sector increase first.
The trade improvement was associated with a more competitive dollar which is similar to what we saw in the last years of the Bush Administration, a benign neglect concerning the dollar because there was improvement in the export sector. This is a dangerous game of trying to keep those who buy US debt happy while trying to create jobs in the economy. Global trade has declined much more than GDP around the world. The steep decline is driven in part with inventory management so it would not be unusual to see the trade sector increase first.
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