Goods Trade Balance Adv

In one past release the deficit narrowed to 94.3 billion dollars from 102.8 billion dollars. Exports stood at 177.0 billion dollars and imports at 271.3 billion dollars. The gain came from both legs, with exports up 4.1 billion dollars and imports down 4.5 billion dollars. Detail diverged: industrial-supplies imports fell 7.1% while other-goods imports rose 6.0% and foods imports rose 2.5%. On the export side consumer goods rose 5.3% and capital goods rose 2.9% while foods exports fell 1.0%. Lesson: the deficit nets offsetting moves, so a narrower deficit can hide rising import groups.

How is Advance International Trade in Goods calculated?

1. Source documents: Census collects export filings plus Canadian import records for United States exports to Canada. It also collects import filings from Customs and Border Protection.
2. Export valuation: Exports use F.A.S., meaning price plus inland freight and insurance to the portside, excluding loading and beyond-port freight. Canadian-sourced exports add about 4.5% inland freight and convert Canadian dollars at the Federal Reserve average monthly rate.
3. Import valuation: Imports use Customs value, meaning price paid for export to the United States, excluding duties, freight and insurance.
4. Low-value trade: Estimated shipments below 2500 dollars for exports and 2000 dollars for imports join the totals through fixed ratios and statistical models.
5. Classification: Every shipment is coded under the Harmonized System, the global goods code family. Detail is grouped into about 140 export and 140 import end-use groups, using about 10000 export codes and 20000 import codes.
6. Seasonal adjustment: Detail is seasonally adjusted with X-13ARIMA-SEATS, the standard seasonal software, where stable seasonality exists, then summed to 6 aggregates.
7. Balance formula: The deficit equals seasonally adjusted exports minus seasonally adjusted imports, with no weights. Below zero means deficit and above zero means surplus. For that release, 177.0 billion dollars minus 271.3 billion dollars gave a 94.3 billion dollar deficit.

Key point: The advance goods deficit is not the final trade deficit. It excludes services and balance-of-payments conversion, meaning later accounting adjustments, uses nearly complete coverage, and needs later revised estimates.