Our trade deficit rose by 9.6% January, as the value of both our exports and our imports increased, but our imports increased by much more. The Census report on our international trade in goods and services for January indicated that our seasonally adjusted goods and services trade deficit rose by $4.2 billion to $48.5 billion in January, the highest in 5 years, from a December deficit which was revised but statistically unchanged at $44.3 billion. The value of our January exports rose by $1.1 billion to $192.1 billion on a $1.1 billion increase to $128.0 billion in our exports of goods and a decrease of less than $0.1 billion to $61.1 billion in our exports of services, while our imports rose $5.3 billion to $240.6 billion on a $5.1 billion increase to $197.6 billion in our imports of goods and a $0.2 billion increase to $42.9 billion in our imports of services.   Export prices averaged 0.2% higher in January, so the real growth in exports was less than the nominal dollar value by that percentage, while import prices were 0.6% higher, meaning real imports were smaller than the nominal dollar values reported here by that percentage.

The increase in our January exports of goods was mostly a result of higher exports of industrial supplies and of automotive products, offset by a decrease in our exports of capital goods.  Referencing the Full Release and Tables for January (pdf), in Exhibit 7 we find that our exports of industrial supplies and materials rose by $2,082 million to $37,961 million on a $697 million increase in our exports of crude oil and a $548 million increase in our exports of petroleum products other than crude or fuel oil, and that our exports of automotive vehicles, parts, and engines rose by $1329 million to $13,616 million on a $874 million increase in our exports of new and used passenger cars and a $306 million increase in our exports of trucks, buses, and special purpose vehicles.  In addition, our exports of foods, feeds and beverages rose by $594 million to $11,204 million on a $407 million increase in our exports of soybeans.  Offsetting those increases, our exports of capital goods fell by $1,889 million to $43,482 million on a $611 million decrease in our exports of civilian aircraft, a $575 million decrease in our exports of engines for civilian aircraft, and a $306 million decrease in our exports of telecommunication equipment, and our exports of consumer goods fell by $11 million to $16,476 million, and our exports of other goods not categorized by end use fell by $1,738 million to $4,202 million..

Exhibit 8 in the Full Release and Tables gives us seasonally adjusted details on our goods imports and shows that higher imports of consumer goods, industrial supplies and materials, and automotive vehicles, parts, and engines were responsible for the increase in January imports.  Our imports of consumer goods rose by $2,406 million to $52,061 million on a $1019 million increase in our imports of cellphones, a $281 million  increase in our imports of nonwool or cotton clothing and textiles, a $236 million increase in our imports of TVs and video equipment, a $208 million increase in our imports of toys, games and sporting goods, and a $205 million increase in our imports of gem diamonds. Our imports of industrial supplies and materials rose by $1,001 million to $42,015 million as our imports of crude oil rose by $1,672 million, our imports of fuel oil rose by $436 million and our imports of other petroleum products rose by $493 million, while our imports of coal fell by $306 million and our imports of fertilizers fell by $370 million.  Our imports of automotive vehicles, parts and engines rose by $899 million to $31,763 million on a $688 million increase in our imports of new and used passenger cars and a $383 million increase in our imports of trucks, buses, and special purpose vehicles. In addition, our imports of capital goods rose by $688 million to $51,091 million on a $374 million increase in our imports of semiconductors.  Meanwhile, our imports of foods, feeds, and beverages fell by $57 million to $11,250 million, and our imports of other goods not categorized by end use fell by $76 million to $7,601 million..

To gauge the impact of January trade on 1st quarter GDP growth figures, we use exhibit 10 in the pdf for this report, which gives us monthly goods trade figures by end use category and in total, already adjusted in chained 2009 dollars, the same inflation adjustment used by the BEA to compute trade figures for GDP, albeit they are not annualized here.  From that table, we can figure that 4th quarter real exports of goods averaged 121.037.7 million monthly in chained 2009 dollars, while inflation adjusted January goods exports were at 124,015 million in that same 2009 dollar quantity index representation.  Annualizing the change between the two figures, we find that January's real exports of goods are running at a 10.2% annual rate above those of the 4th quarter, or at a pace that would add about 0.83 percentage points to 1st quarter GDP if continued through February and March.  In a similar manner, we find that our 4th quarter real imports of goods averaged 183.210.3 million monthly in chained 2009 dollars, while inflation adjusted goods imports in January were at 189,361 million.  That would indicate that so far in the 1st quarter, we have seen our real imports increase at a 14.1% annual rate from those of the 4th quarter.  Since imports subtract from GDP because they represent the portion of consumption or investment that occurred during the quarter that was not produced domestically, their increase at a 14.1% rate would subtract 1.61 percentage points from 1st quarter GDP.  Hence, if the January trade deficit is maintained at the same level throughout the 1st quarter, our deteriorating balance of trade in goods would subtract about 0.78 percentage points from the growth of 1st quarter GDP.  Note that we have not computed the impact of the less volatile change in services trade here because the Census does not provide inflation adjusted data on those, and we don't have easy access to the details on their price changes, but that our nominal services surplus decreased by $0.3 billion, in yet another negative impact on first quarter GDP.

(note: the above was excerpted from my weekly synopsis at Marketwatch 666)