U.S. Trade Deficit Shrinks, But So Does Canada’s Trade Surplus

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

• The U.S. trade deficit fell to $66.5 billion in April 2022 from a record level of $87.1 billion in March 2022. The improvement was due to an $8.5 billion increase in exports and a $12.1 billion drop in imports. The nation’s trade gap with China fell $8.5 billion to $34.9 billion in April. The goods deficit dropped $19.1 billion to $107.7 billion and the services surplus rose $1.5 billion to $20.7 billion. Year-over-year, the news was not as bright. The total trade gap increased 41.1 percent from April 2021 to April 2022. Read the full report here.
• Statistics Canada reported the country’s merchandise trade surplus fell to $1.5 billion in April 2022 from $2.3 billion in March 2022. In volume terms, imports fell 0.4 percent in April. Exports were down 2.1 percent. Canada’s trade surplus with the United States dropped to $11.6 billion in April from a record high of $12.2 billion in March. The merchandise trade deficit with countries other than the United States rose to $10.1 billion in April from $9.9 billion in March.
• Canada added 40,000 jobs in May as the country’s unemployment rate fell to 5.1 percent. Long-term unemployment accounted for 19.7 percent of all unemployment, up from 15.6 percent in February 2020 before the COVID-19 pandemic. The employment increase was spread across several industries, but was led by employment gains in wholesale and retail trade. Total hours worked were little changed in May, but were up 5.1 percent compared with 12 months earlier. Wages also were up. Read the full report here.
• According to the U.S. Department of Labor, 229,000 individuals filed for federal unemployment benefits for the first time during the week that ended June 4, 2022, an increase of 27,000 from the previous week’s level. The 4-week moving average was 215,000, an increase of 8,000 from the previous week. The four-week moving average of people who continued to receive jobless benefits declined, however.
• U.S. average hourly earnings  for all employees decreased 0.6 percent from April 2022 to May 2022 due to an historic increase in consumer inflation. Specifically, the U.S. Consumer Price Index (CPI) rose one percent between April 2022 and May 2022 and 8.6 percent between May 2021 and May 2022.