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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: LTK007 who wrote (30725)	10/20/1999 9:59:00 AM
From: Les H	Read Replies (1) \| Respond to of 99985

US AUG TRADE DEFICIT NARROWS TO -$24.1B, MORE AIRCRAFT EXPORTS By Joseph Plocek WASHINGTON (MktNews) - The U.S. August trade balance was -$24.1 billion, a bit lower deficit than expected and $0.8 billion less than in July as aircraft exports surged. Imports jumped $2.1 billion or 2%, with $0.8 billion (38%) of the gain related to crude oil and petroleum products. The average price of imported oil jumped 10% or $1.79, to $17.80. Oil is now at its highest level since March 1997, when its import price averaged $18.76. But auto imports were up $0.4 billion (primarily from Canada as re-imports fueled the record new auto sales pace and pushed the deficit with that country to a record -$3.5 billion). "Other" goods imports were up $0.4 billion. Exports gained $2.9 billion in August, or +3.7%, reflecting in large part a $1.7 billion surge in aircraft deliveries as U.S. Commerce Department data played catch-up to industry reports. One possible reason for the discrepancy is that aircraft are sometimes "stored" at overseas hangers prior to airlines putting them into service in the home country. Somewhat perversely, higher commodities prices are helping as well as hurting the trade balance. Industrial supplies exports rose $0.9 billion, also helped by higher prices for ores and oil. Non-monetary gold was up $252 million, for example, and chemicals and plastics exports -- where the products are derived in large part from oil -- rose a total of $395 million. Country deficits show more of the same: Asia producers continue to fill insatiable U.S. consumer demand. There was a reversal in the roles of two major Eastern trade partners, however. The trade deficit with China was -$6.9 billion, versus -$6.3b in July, the first time this exceeded the deficit with Japan since January 1999. The deficit with Japan was -$6.4 billion, versus -$6.8 billion in July. The deficit with the Newly Industrialized Countries was -$1.7 billion, versus -$2.5 billion in July. The last may help the smaller Asia currencies. The oil deficit alone was -$5.9 billion, the highest since -$6.4 billion in December 1996. Oil was primarily responsible for widening the deficit with OPEC to a record -$2.7 billion and the deficit with Mexico to -$2.2 billion. The median estimate in a Market News International poll of economists was for a $25.0 billion trade deficit. The actual result of -$24.1 billion breaks a recent pattern where economists were substantially under-estimating the monthly deficit. Whether the narrowing trade gap is a trend or reflects only the quirk in aircraft accounting remains to be seen.