Canadian, U.S. Trade Deficits Widen

Connecting the Dots monitors all major economic announcements in the United States and Canada, but MSCI also offers industrial metals industry-specific data products that provide much deeper analysis and insight. Visit MSCI’s website and click on industry data to learn more about our Metals Activity Report (MAR), Momentum Monitors, and Economic Pulse.

Meanwhile, here are the major economic headlines from the last week:

• The U.S. trade deficit rose by 12.2 percent in 2022 to a record $948.1 billion due to the fact that Americans bought more machinery, medicines, car parts, and other goods from foreign suppliers. December exports were $250.2 billion, $2.2 billion less than in November. December imports were $317.6 billion, $4.2 billion more than November imports. High inflation and energy prices also contributed to the increase in the trade gap while the deficit in goods exchanged with Mexico, Canada, India, South Korea, Vietnam, and Taiwan grew significantly due to the fact that businesses tried to diversify their supply chains after the U.S. government tightened rules on trade with China. The United States’ trade gap with China rose eight percent to $382.9 billion, its second highest level ever.
• Statistics Canada reported last week that the country ran a merchandise trade deficit of $160 million in December due to the fact that both exports (down 1.2 percent) and imports (down 1.3 percent) fell from November to December. Canada’s trade surplus with the United States increased, however, rising $7 billion. Its trade deficit with all countries except the United States rose by $7.1 billion. Read the full report here.
• The Canadian economy added 150,000 jobs in January (including 121,000 full-time positions) and the nation’s unemployment rate held steady at five percent, near its record low of 4.9 percent. Employers added jobs in most sectors, with wholesale and retail trade experiencing the largest gains to employment. Read the full report here.
• According to the U.S. Department of Labor, 196,000 individuals filed for federal unemployment benefits during the week that ended February 4, a figure that was up from 183,000 the week before. The four-week moving average fell, however, while the number of individuals who continued to receive benefits rose to 1.688 million for the week that ended January 28, an increase of 38,000 from the week before. The four week moving average of continuing claims also increased.
• According to the MetLife and U.S. Chamber of Commerce Small Business Index survey, 89 percent of small businesses said their business is in average, good, or very good health in the fourth quarter of 2022. Of those, 64 percent said their business is good or very good. When asked about their feelings on the overall economy, however, only 27 percent of small business owners said feel the U.S. economy is in good health. Read more here.