Declining Consumer Demand Lowers Trade Deficit
The Bureau of Economic Analysis of the Department of Commerce reported that the US trade deficit shrank from $39.9 million in December 2008 to $36 million in January 2009. However, a decline in consumer demand for most goods and services drove the decline.
Total US exports of goods and services in January 2009 were $124.9 billion and imports were $160.9 billion. Exports dropped 9.4% from $132.5 billion in December 2008, and imports dropped 6.6% from $172.4 billion in December 2008.
Of particular interest to retailers, exports of goods decreased from $88.7 billion in December 2008 to $82.2 billion in January 2009, a 7.3% drop, and imports of goods decreased from $141.1 billion in December 2008 to $129.2 billion in January 2009, a 7.7% drop.
Monthly declines in exports of specific goods categories included $2.2 billion in automobile vehicles, parts and engines; and $700 million in industrial supplies and materials. Exports of foods, feeds and beverages increased by $100 million. Imports of automobile vehicles, parts and engines decreased $3.3 billion, imports of consumer goods decreased $3.2 billion, and imports of foods, feeds and beverages decreased $300 million.
For the three nths ending in January 2009, exports of goods and services averaged $132.7 billion, while imports of goods and services averaged $172.2 billion, resulting in an average trade deficit of $39.5 billion. For the three months ending in December 2008, the average trade deficit was $46.8 billion, reflecting average exports of $141 billion and average imports of $187.8 billion.
In February, a report in the International Business Times said that the recession and low oil prices were pushing the US trade deficit to lower levels and that it could go as low as $27 to $29 billion during the first half of 2009.