By Timothy R. Homan
Sept. 11 (Bloomberg) -- The U.S. trade deficit probably widened in July for the first time in three months, reflecting record-high oil prices, economists said ahead of a government report today.
The gap increased to $58 billion from $56.8 billion in June, according to the median forecast of 75 economists surveyed by Bloomberg News.
An increase in exports, propelled by a six-year slide in the dollar that made American goods affordable for overseas buyers, probably prevented the deficit from ballooning even more. The U.S. may not be able to count on similar gains in coming months as economies in Europe and Japan shrink and the dollar recovers.
``Export growth will slow down, but it's still going to stay a bright spot in the economy,'' said Allen Sinai, chief global economist at Decision Economics Inc. in New York. ``It's going to get hurt by the slowing of growth in the world economy.''
The Commerce Department is scheduled to release the trade report at 8:30 a.m. in Washington. Estimates of the deficit ranged from $54.6 billion to $62.5 billion.
A Labor Department report on import prices, due at the same time, may show oil will be less of a threat to the trade gap in coming months. The cost of goods made overseas fell 1.8 percent in August from the previous month, the biggest decline in almost two years, according to the survey median.
The drop was led by a slump in fuel expenses, economists said. Last month's report showed imported petroleum prices jumped 4 percent in July.
Jobless Claims
Also at 8:30 a.m., the Labor Department is projected to report that initial jobless claims last week fell to 440,000 from 444,000 the previous week, according to the survey. Such a reading would signal the labor market is deteriorating.
The smallest trade deficit in eight years was the biggest contributor to the 3.3 percent pace of economic expansion last quarter. The narrower gap added 3.1 percentage points to growth, the most since 1980.
Exports have received a boost from the 7 percent decline in the dollar against a trade-weighted basket of currencies of major trading partners in the 12 months ended in July. The currency dropped 27 percent from February 2002 to April of this year, when it started to recover.
Boeing Co., the world's second-biggest aircraft maker, has been one the beneficiaries of the more competitive dollar. Fifty of the Chicago-based company's 70 aircraft orders in July came from abroad. It delivered 25 planes to overseas buyers that month compared with 28 in June.
Boeing Strike
A machinist's strike this month could prevent Boeing from boosting shipments in coming months, adding to concern U.S. exports will slow. In the past, work stoppages by members of the company's largest union, the International Association of Machinists and Aerospace Workers, have lasted four to 10 weeks.
Another threat to exports is that economies overseas are weakening as the U.S. slows. The European Commission yesterday cut its growth outlook for the euro area for the rest of this year and predicted a recession for Germany, the region's largest economy. Japan's economy shrank at a 2.4 percent annual pace in the second quarter.
The global slowdown is making it difficult for U.S. companies to offset weak domestic demand. Dell Inc., the world's second-biggest personal-computer maker said on Aug. 29 that the U.S. slump in technology spending had spread to Europe and Asia. Profit in the second quarter declined 17 percent.
Sales to commercial clients in Asia advanced 16 percent, slower than the 19 percent growth in the first quarter, Dell said. Sales to corporate customers in Europe, the Middle East and Africa rose 11 percent, short of the 15 percent increase in the previous period.
Bloomberg Survey
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Trade Import Initial
Balance Prices Claims
$ Blns MOM% ,000's
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Date of Release 09/11 09/11 09/11
Observation Period July Aug.Aug. 30
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Median -58.0 -1.8% 440
Average -58.2 -1.8% 440
High Forecast -54.6 0.5% 460
Low Forecast -62.5 -3.3% 400
Number of Participants 75 54 44
Previous -56.8 1.7% 444
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4CAST Ltd. -58.5 -3.2% 430
Action Economics -62.5 -3.0% 435
AIG Investments -56.7 -2.6% ---
Aletti Gestielle SGR -54.6 --- 450
Argus Research Corp. -58.0 0.5% ---
Banc of America Securitie -59.8 --- ---
Bank of Tokyo- Mitsubishi -59.4 -0.7% 434
Bantleon Bank AG --- -1.6% ---
Barclays Capital -59.0 -1.5% 440
BBVA -58.3 -1.2% ---
BMO Capital Markets -58.0 -1.4% 440
BNP Paribas -59.1 -1.0% 454
Briefing.com -56.0 --- 430
Calyon -57.8 --- ---
CFC Group -58.0 --- ---
CIBC World Markets -58.0 --- ---
Citi -59.5 -1.0% 455
ClearView Economics -58.5 --- ---
Commerzbank AG -58.0 --- 435
Credit Suisse -57.5 -0.8% 440
Daiwa Securities America -61.0 --- ---
DekaBank -58.0 -2.8% ---
Desjardins Group -59.0 -1.0% 435
Deutsche Bank Securities -57.5 -2.0% 450
Deutsche Postbank AG -58.0 -1.3% ---
Dresdner Kleinwort -56.0 -3.3% ---
DZ Bank -58.0 -1.2% ---
First Trust Advisors -57.4 -0.8% 443
Fortis -60.0 -1.5% ---
Global Insight Inc. -61.5 --- ---
Goldman, Sachs & Co. -59.0 --- ---
H&R Block Financial Advis -56.0 -1.5% 440
Helaba -58.0 -1.5% ---
High Frequency Economics -60.0 -3.0% 430
Horizon Investments -57.5 -2.0% ---
HSBC Markets -58.5 -3.3% 430
IDEAglobal -58.5 -2.0% 435
Informa Global Markets -56.6 -1.0% 445
ING Financial Markets -57.7 -2.1% 435
Insight Economics -59.0 -2.0% 430
Intesa-SanPaulo -58.0 -2.0% ---
J.P. Morgan Chase -58.5 -2.0% 440
Janney Montgomery Scott L -57.0 --- ---
JPMorgan Private Client -56.5 --- 440
Landesbank Berlin -56.5 -2.5% 425
Landesbank BW -57.0 -2.3% ---
Lehman Brothers -57.0 -1.8% 435
Lloyds TSB -58.0 -1.0% 450
Maria Fiorini Ramirez Inc -58.0 -2.0% 450
Merk Investments -58.5 -0.7% 440
Merrill Lynch -58.6 -2.0% 450
MFC Global Investment Man -58.0 -1.8% 430
Moody's Economy.com -57.5 -1.8% 440
Morgan Stanley & Co. -60.0 --- ---
National Bank Financial -57.0 --- ---
National City Corporation -57.5 -0.8% ---
Natixis -59.3 -1.6% ---
Nomura Securities Intl. -57.9 --- ---
Nord/LB -57.5 --- 430
PNC Bank -55.5 --- ---
RBS Greenwich Capital -60.0 --- 455
Ried, Thunberg & Co. -60.0 -3.0% 450
Schneider Trading Associa -58.0 -1.5% 433
Scotia Capital -59.0 -1.8% 440
Societe Generale -57.0 --- 440
Stone & McCarthy Research -57.0 -1.5% 460
TD Securities -58.0 --- 450
Thomson Financial/IFR -57.3 -1.0% 445
UBS Securities LLC -60.0 -3.0% ---
Unicredit MIB -56.0 -0.8% 400
University of Maryland -58.3 -1.8% 435
Wachovia Corp. -58.7 --- ---
Wells Fargo & Co. -62.5 -3.0% ---
WestLB AG -58.0 -1.6% ---
Westpac Banking Co. -55.7 -2.0% 450
Wrightson Associates -60.0 -3.0% 450
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To contact the reporter on this story: Timothy R. Homan in Washington at thoman1@bloomberg.net
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