US DATA: Another Trade Surprise But Goods Deficit Is Still Smallest Since 1990s

Volatility remained rife in trade data for back in November, with the goods & services deficit surprising higher after the particularly small deficit in last month’s update. The recent goods-only deficit at 2.8% GDP continues to track at its lowest since the late 1990s.  

• The goods & services trade deficit swung back higher in November, to $56.8bn (cons $44bn) after $29.2bn in Oct ($29.4bn initially in what had been a much smaller than expected print last month) for its largest monthly deficit since July.
• It was driven entirely by the goods deficit ($86.9bn after $59bn in Oct and $78bn in Sep) whilst the services surplus held at $30.1bn after $30.0bn.
• Highlighting the volatility, goods exports fell -5.6% M/M after 4.2% whilst goods imports rose 6.6% M/M after -4.3%. Drivers here include a pullback in gold exports along with higher computer and pharma imports – see part two.  
• It left a goods & services trade deficit unchanged at 1.7% GDP on a three-month rolling basis, whilst the goods deficit narrowed a tenth to 2.8% GDP (a new recent low since the late 1990s) and the services surplus dipped back a tenth to 1.1% GDP.
• Last month’s Q3 current account release caught President Trump’s attention, writing at the time on the goods balance that: “Numbers released today show that the United States of America has the lowest Trade Deficit since 2009, and going even lower”.
• Comparing the latest three month goods balances with those from end-2024 by country, the largest adjustments have come from China at +0.5pp (deficit halved from 1.0% to 0.5% GDP), Switzerland at +0.5pp (deficit of 0.3% GDP to a surplus of 0.3 GDP) with gold shipment volatility at play, and the EU ex Ireland at +0.3pp (deficit from 0.5% to 0.2% GDP).
• USMCA partners continue to have seen relatively little change however, with the Canadian balance improving by just 0.1pp (deficit from 0.2% to 0.1% GDP) and the balance with Mexico actually widening 0.1pp (deficit from 0.6% to 0.7% GDP).