Home > Data Release, GDP, US > Trade Data: Good News for Recovery, But Wider Than Anticipated Deficit Likely Means Downward Revision to Q3 Growth

Trade Data: Good News for Recovery, But Wider Than Anticipated Deficit Likely Means Downward Revision to Q3 Growth

November 13th, 2009 Michael McDonough

September’s trade deficit widened more than anticipated to -US$36.5B from a revised -US$30.8bn in August (originally -US$30.7bn).  Exports rose by +2.9% to US$132.0B, while imports were up a more significant +5.8% to US$168.4B–with auto imports rising a substantial US$1.4bn.  It is not at all unusual for the trade deficit to widen during the early stages of an economic recovery.  But, the wider than anticipated trade gap could place some downward pressure on third quarter GDP growth, which according to the advance release was estimated at 3.5%.  The data presently available would indicate a growth rate of closer to 3.0%.  At the same time, stronger US exports should help bolster the domestic manufacturing sector.

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