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MNI DATA IMPACT: US January Trade Gap Narrowed To $51.1b>

By Kevin Kastner, Shikha Dave and Harrison Clarke
     WASHINGTON (MNI) - The U.S. international trade gap narrowed to 
$51.1 billion in January from a slightly revised $59.9 billion in 
December, a much smaller gap than the $57.0 billion deficit expected by 
the Bloomberg consensus and a $57.5 billion gap expected by an MNI 
survey, data released by the Commerce Department Wednesday morning 
     The December gap was the widest since 2008, so the narrower January 
gap is simply a return to a more normal level. Seasonal adjustment was a 
factor in December's widening, and the reverse occurred in January, with 
seasonal factors turning an unadjusted widening into a narrower gap. 
Here are the key findings from the release:
     - Imports fell sharply on declines in capital goods and 
industrial supplies, the latter led by a sharp decline in crude oil 
imports. The unadjusted barrel price of crude oil was the lowest in over 
two years, continuing the downward trend in recent months.
     - Exports rebounded from a December dip, led by foods and feed, 
autos and consumer goods.
     - The unadjusted goods trade gap actually widened in January to 
$76.3 billion from $73.8 billion in December, so seasonal adjustment 
factors accounted for the seasonally adjusted narrowing.
     - The overall BOP goods gap narrowed to $73.3 billion from $81.5 
billion in December, while the services surplus widened to $22.1 
billion. The petroleum gap narrowed to $0.9 billion in January from $1.2 
billion in December, while the nonpetroleum goods gap narrowed to $71.2 
billion from $79.1 billion. 
     - The unadjusted bilateral trade gaps narrowed with all the major 
trading partners. The gap with China narrowed to $34.5 billion in 
January from $36.8 billion in December. At the same time, the gap with 
the EU narrowed to $11.7 billion from $15.1 billion. The gap with Canada 
was cut in half to $0.8 billion from $1.4 billion, while the gap with 
Mexico narrowed to $5.8 billion from $7.7 billion. 
     - Most interesting is the narrower Canada gap, which has improved 
noticeably from January 2018, when it was $3.7 billion, suggesting 
tariff action has been partially successful at trimming the deficit.
     ** MNI Washington Bureau: 202-371-2121 ** 

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