U.S. Trade Deficit Narrows While Canada’s Surplus Improves

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

• The U.S. monthly trade deficit fell from $84.9 billion in May 2022 to $79.6 billion in June 2022 as exports hit record levels and imports declined. The goods deficit fell $4.9 billion in June to $99.5 billion while services surplus expanded to $19.9 billion. Year-to-date, the goods and services deficit increased $134.1 billion, or 33.4 percent, from the same period in 2021. Exports were up 20 percent year-over-year while imports rose 23.3 percent.
• Canada’s trade surplus expanded from C$4.8 billion in May to C$5 billion in June and is now at its highest level in 14 years. The improvement was largely due to rising oil exports. Overall, exports were up two percent to a record C$69.9 billion during the month, outpacing a 1.7 percent increase in imports. In the first six months of 2022, Canada recorded a cumulative C$19.9 billion of surpluses. Click here to read the full report.
• New orders for goods manufactured in the United States rose two percent in June to $555.2 billion while shipments increased 1.1 percent to $551.9 billion. The number of unfilled orders also jumped, rising 0.7 percent to more than $1.1 trillion. The unfilled orders-to-shipments ratio was 6.03, up from 5.98 in May. Inventories also rose, increasing 0.4 percent to $801.5 billion. The inventories-to-shipments ratio was 1.45, down from 1.46 in May.
• The S&P Global Canada Manufacturing Purchasing Managers’ Index (PMI) fell to 52.5 in July from 54.6 in June, its lowest level since June 2020. Both output and new orders fell below the 50 mark that denotes contraction for the first time since June 2020. The output index was at 48.9 while new orders were at 48.8. Click here to read the full report.
• The Institute for Supply Management’s manufacturing purchasing managers’ index (PMI) fell from 53.0 in June to 52.8 in July. The index is now at its lowest level since June 2020. New orders contracted for the second straight month, but production continued to expand. Click here to read the full report. Manufacturers added 30,000 jobs.
• The Canadian economy lost 31,000 jobs in July, but the country’s unemployment rate remained steady at 4.9 percent — a rate that is at its lowest levels since 1976. Statistics Canada also said last week that there are one million jobs that are currently unfilled in the country. Click here to find all employment-related data.
• U.S. job openings dropped in June to their lowest level in nine months in June. There were 10.7 million job openings that month, down from 11.3 million in May. Analysts said the data pointed to a cooling labor market. Click here to read the full report. There were 790,000 manufacturing job openings in June.
• During the week that ended July 30, 260,000 individuals filed for U.S. unemployment benefits for the first time, an increase of 6,000 from the previous week. The four-week moving average of first-time claims was 254,750, 6,000 more than the week before. During the week that ended July 23, 1.416 million people continued to receive benefits, an increase of 48,000 from the previous week. The four-week moving average of continuing claims also rose.
• In other economic news: Seasonally adjusted compensation costs increased 1.3 percent for U.S. civilian workers for the three-month period ending June 2022; U.S. construction spending fell 1.1 percent between May 2022 and June 2022, but was still up 8.3 percent from June 2021 to June 2022.