Trade Gap Widens In August

A surge in imports of new iphones helped feed what was an unusually wide trade gap in August of $48.3 billion, well up from July's revised $41.8 billion. But cell phone imports, at $2.1 billion, make up only a small portion of the gap with a drop in exports the most salient factor. Exports were down nearly across the board including industrial supplies at minus $2.2 billion, consumer goods at minus $0.6 million, autos at minus $0.5 million, and foods/feeds/beverages at minus $0.3 million. Weakness in exports reflects weakness in foreign demand together with the strength of the dollar.

Recent History Of This Indicator:
The international trade gap is expected to widen substantially based on the prior week's advance data in the international trade in goods report where, due to a decline in exports and a rise in imports, the gap rose sharply. Weakness in exports has been a negative theme all year for the economy but the rise in imports, though counted as a subtraction in the national accounts, does underscore the strength of domestic demand. The consensus sees a gap at a very steep $48.6 billion for August.