WASHINGTON (MarketWatch) — An early look at U.S. trade patterns in July points to a wider deficit.
The advanced trade gap in goods — services are excluded — widened by nearly 1.8% to $65.1 billion in July, the Commerce Department said Monday. Both exports and imports declined, but exports dropped at a faster pace.
Economists surveyed by MarketWatch expected a goods trade deficit of $64.6 billion.
The government will release overall trade numbers, including services, for July next week, but the size of the trade deficit is generally tied to changes in exports and imports of goods. Trade patterns involving services rarely change much from month to month.
Despite the wider deficit, economists expect trade to be positive to growth in the third quarter. U.S. exports are being helped by a rebound in global growth and a weaker dollar. Economists note that the wider deficit in July follows a sharp narrowing in June, when the overall trade deficit slumped to an eight-month low, which should help smooth the quarterly impact.
A wider deficit is generally negative for gross domestic product, the official scorecard for the U.S. economy. Trade has been positive for growth in the first two quarters of the year after being a drag for most of the past three years.
An advanced look at wholesale inventories, meanwhile, showed a 0.4% increase in July. And an early look at retail inventories reflected a 0.2% decline.
The data had little impact in keeping U.S. stocks
from early gains as focus remained on the energy market and broader economic implications from Hurricane Harvey.