More Winning: Trade Deficit Deepens Much More Than Expected


The US trade deficit widened to $55.5 billion from a negatively revised $51.2 billion. The consensus was $53.5 billion.

The Monthly International Trade in Goods and Services report by the Census Bureau shows the goods and services deficit was $55.5 billion in May, up $4.3 billion from $51.2 billion in April, revised.

The Econoday consensus was for the deficit to increase to $53.5 billion from a prior reading of $50.8 billion, now revised to $51.2 billion.

The $-55.5 billion result was outside the entire estimate range of $-54.7 billion to $-49.5 billion.

Exports, Imports, and Balance

  • May exports were $210.6 billion, $4.2 billion more than April exports.
  • May imports were $266.2 billion, $8.5 billion more than April imports.
  • The May increase in the goods and services deficit reflected an increase in the goods deficit of $4.4 billion to $76.1 billion and an increase in the services surplus of $0.1 billion to $20.6 billion.

By Country

Surpluses: The May figures show surpluses, in billions of dollars, with South and Central America ($4.1), Hong Kong ($2.6), Singapore ($0.6), Brazil ($0.5), Saudi Arabia (less than $0.1), and United Kingdom (less than $0.1).

Deficits: Deficits were recorded, in billions of dollars, with China ($30.1), European Union ($16.9), Mexico ($9.1), Japan ($6.0), Germany ($5.8), Canada ($3.6), Italy ($2.6), France ($2.1), India ($1.9), Taiwan ($1.5), South Korea ($1.4), and OPEC ($0.1).

Non-Petrol Exports

Year-to-Date Numbers

Year-to-date, the goods and services deficit increased $15.7 billion, or 6.4 percent, from the same period in 2018. Exports increased $5.1 billion or 0.5 percent. Imports increased $20.8 billion or 1.6 percent.

Small gains vs China were wiped out by losses elsewhere, notably Mexico and the EU.

Trump is sure to howl about the EU.

Don't worry, imports will plunge in a recession.

Mike "Mish" Shedlock

Comments (23)
No. 1-4

The next step is self-reliance. This means bringing industries back to America. Only minimal trade is actually necessary. The world is truly screwed if the US becomes self reliant. The US consumer has been driving global growth for 2 decades or more.


Winning is dependent on Trumps goal. If it's to reduce our overall trade deficit, then it's not winning. If it's to hurt China's economy, then he is winning. China will suffer more damage than the US from the trade war.


Is the YTD deficit with China really down 10.8%?


The US will continue to run trade deficits until such time as it can compete with other countries in making the products that are being imported.

To become competitive would require a drop in wages to $2/hr for Americans working in those industries. Since that isn’t going to happen, it is a waste of time to try to pursue those low-paying jobs in manufacturing.

Face it: the US is no longer primarily, a Manufacturing Economy. It is a high technology, knowledge based, and service economy. Trying to re-energize industries that you no longer can compete in is foolhardy at best.

It’s the same with coal. Trump wants to support that industry as well, even though coal mines continue to close, primarily because they can’t compete with low-priced natural gas and renewables. Supporting uncompetitive industries is a waste of resources.

This is what happens when governments (or Presidents) think they can pick winning industries. It turns into a disaster.

Global Economics