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Trade Balance Maintains Trend Seen YTD

US DATA
  • The US trade deficit was only marginally higher than expected in June at -$65.5B (cons -$65B) in the finalized release although it followed a smaller than first thought $68.3B (initial -$69.0B).
  • It doesn’t alter the recent trend, with a deficit tracking between 3-3.2% GDP so far this year, small by post-pandemic standards as it is mostly back in line with the 2.5-3% GDP deficits sustained pre-pandemic.
  • Comparing with pre-pandemic trends, the goods deficit at 4% GDP has recovered to ‘typical’ levels whilst it’s the service surplus that still lags at 1% GDP as it holds near post-pandemic lows.

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