International Trade (Mar)

Although both exports and imports rebounded strongly in March, the former are still 5% below pre-pandemic levels whereas the latter are about 8% higher. As virus restrictions in other advanced economies are eased and demand rebounds, however, that gap should soon start to close.
Andrew Hunter Senior US Economist
Continue reading

More from US

US Economics Weekly

Lasting price pressures building

The continued surge in prices last month was again mostly concentrated in sectors reopening or facing intense supply constraints, which allows the Fed to stick with its “largely transitory” story for now. But with signs of cyclical price pressures building and the extremely strong job openings and quits figures pointing to stronger wage pressures, we believe the Fed will eventually have to acknowledge that inflation will remain elevated for much longer.

11 June 2021

US Data Response

Consumer Prices (May)

The further jump in core CPI inflation to a 28-year high of 3.8% in May, from 3.0%, was again driven by the same handful of categories most directly affect by the lifting of virus restrictions. But there were also signs of emerging inflationary pressures in other sectors, including housing costs and restaurant prices, which suggests that not all the current upward pressure on inflation will prove transitory.

10 June 2021

US Fed Watch

Talking about talking about tapering

Fed officials may finally begin ‘talking about talking about’ tapering their asset purchases at next week’s FOMC meeting. But with recent data leaving the economy still some way from making “substantial further progress” towards the Fed’s full employment goal, we suspect that taper won’t begin until early next year.

9 June 2021

More from Andrew Hunter

US Employment Report Preview

Labour shortages may take some time to clear

With labour shortages weighing on hiring there is even more uncertainty than usual over May’s employment report, but we estimate that non-farm payrolls rose by a relatively subdued 500,000.

27 May 2021

US Chart Book

Supply shortages getting worse

The strength of demand coupled with supply constraints have made shortages of many goods even worse, with the inventory to sales ratio falling to a record low in March. The surge in job openings and share of employers saying they are struggling to fill those vacancies reveals that shortages are increasingly affecting the labour market too. While most of the surge in consumer prices in April specifically can be traced to sectors affected by shortages and reopening demand, there are signs of more lasting inflationary pressure beginning to mount in the background. With wage growth and inflation expectations also heating up, we are increasingly confident in our view that what started out as a largely transitory rise in inflation will become entrenched over the next few years.

18 May 2021

US Data Response

Retail Sales (Apr.)

The unchanged reading for retail sales in April is slightly stronger than it looks given that it follows an upwardly revised 10.7% m/m surge in March, and it suggests that the boost from the $1,400 stimulus cheques has only partly faded. Nevertheless, as goods spending inevitably drops back over the coming months, we were hoping for an offsetting rebound in services. But food services sales only increased by 3.0% last month, a marked slowdown on the March gain, which is a hint that labour shortages and the resulting surge in wages and prices may be acting as a constraint on the recovery in real activity.

14 May 2021
↑ Back to top