March Trade Deficit Much Higher Than Expected

First-quarter GDP, barely above zero at plus 0.2 percent for the advance estimate, may move into the negative column on revision following a much higher-than-expected March trade deficit of $51.4 billion. The unwinding of the port strike on the West Coast, which was resolved mid-month March, played a major role in the data especially evident in imports which surged $17.1 billion in the month as backlogs at the ports were cleared. Imports of consumer goods, especially cell phones, were especially heavy. Exports, led by aircraft, also rose but only $1.6 billion. The total goods gap in the month was $70.6 billion which is the highest since August 2008.

Recent History Of This Indicator:
The international trade deficit is expected to widen out sharply in March, to $42.0 billion from $35.4 billion in February when imports fell sharply, a drop tied to soft import prices and the West Coast port strike. Imports are expected to bounce back up in the March report. Also keep an eye out on exports which will offer the latest clues on the negative effects of the strong dollar.