United States, Canada Both Ran Trade Deficits In May
- The U.S. trade deficit increased from $69.1 billion in April to $71.2 billion in May. The goods deficit increased $2.3 billion in May to $89.2 billion. The services surplus increased $0.1 billion in May to $17.9 billion. Exports increased $101.6 billion or 11.4 percent. Imports increased $212.5 billion or 18.7 percent. Year-to-date, the goods and services deficit increased $110.9 billion, or 45.8 percent, from the same period in 2020. Read the full report here.
- Canada’s merchandise trade deficit was C$1.12 billion, a complete reversal of the C$440 million surplus analysts had expected and also a reversal from April’s C$462 million surplus. Exports fell 1.6 percent in May while imports increased 2.1 percent. On a 12-month basis, exports were up 45.7 percent while imports climbed 42.2 percent.
- New orders for U.S. manufactured goods rose 1.7 percent in May to $495.5 billion while shipments increased 0.7 percent to $490.4 billion. Unfilled orders were up 0.8 percent and the unfilled orders-to-shipments ratio was 6.95, up from 6.88 in April. Inventories, meanwhile, increased 0.9 percent to $731.6 billion and the inventories-to-shipments ratio was unchanged from April at 1.49.
- The U.S. economy added 850,000 jobs in June and the national unemployment rate rose slightly from 5.8 percent to 5.9 percent. Manufacturers added just 15,000 jobs in June. Read the full report here. Meanwhile, the Canadian economy added 231,000 jobs in June as the nation’s unemployment rate fell to 7.8 percent. In related news: at the end of May, there were more than 2 million job openings in the United States, a record high and 16,000 more than in April.
- The Federal Reserve Bank of Dallas’ index of factory activity for Texas expanded at a faster pace in June. The production index rose 14 points to 29.4, a reading indicative of strong output growth while the new orders index came in at 26.7, up from 20.8 in May and quadruple the series average of 6.4. The bank’s general business activity index fell only slight to 31.1, but is still higher than its series average of 2.8 and. Read the bank’s full report here.
- According to the U.S. Department of Labor, 364,000 individuals filed for federal unemployment benefits during the week that ended June 26, a decrease of 51,000 from the previous week’s level. This number is the lowest level for initial claims since March 14, 2020 when it was 256,000. The four-week moving average of first time claims was 392,750, a decrease of 6,000 from the previous week’s average. That number is at its lowest level since March 14, 2020 when it was 225,500.
- In other economic news: the Conference Board’s Consumer Confidence Index rose to 127.3 in June from 120 in May due to improved feelings about current and future conditions; U.S. construction spending fell 0.3 percent between April 2021 and May 2021, but increased 7.5 percent between May 2020 and May 2021; the IHS Markit Canada Manufacturing Purchasing Managers’ index (PMI) fell to 56.5 in June, its lowest reading in four months, from 57.0 in May; and the Institute for Supply Management’s PMI for the United States fell 0.6 percentage points from the May reading of 61.2 percent due to slight declines in new orders and employment. Read the full report here.