Posts Tagged ‘trade deficit’
Dependable Dollar
A cornerstone of international trade is nations that run trade surpluses can be confident that the money they acquire by running trade surpluses, almost always US dollars, will hold its purchasing power over time. If there is a move away from a dollar-based system to Argentinian Pesos, Russian Rubles or Chinese Yuan, trade will weaken…
Read MoreExcellent Exports
The March trade deficit narrowed from $41.9 billion to $40.4 billion; good news. The better news, exports at $193.9 are at their second highest level ever and are 17% above their pre-recession high. Imports, while hitting a new all-time high of $234.3 billion, are just 1% higher than their pre-recession peak. Both imports and exports…
Read MoreGreener Greenback
The dollar has been dramatically strengthening against most currencies of late and this will hurt US exports by making them more expensive in local currency and boosting imports, worsening our trade deficit. It’s happening because as our economy strengthens, interest rates will rise, making our currency more desirable to hold. By contrast, interest rate increases…
Read MoreTrade Deficit Dynamics
The March trade deficit fell by 2.6% but, hold the applause. Imports fell 1.7% due to a fall in demand for crude oil. Exports fell 1.4% as US auto, industrial machinery & food products fell. As if the decline in exports was not bad enough, for the first few months of ’11 the deficit is…
Read More