Decline in March Trade Gap Should Help to Boost Q1 GDP
Broad-based declines in imports, which reflect some statistical payback from strength during the previous month, caused the trade gap to narrow in March. By itself, the revised trade data would boost real GDP growth in the first quarter from 0.6 percent to 1.3 percent.
Big Decline in Imports Bring Down Trade Deficit
- Broad-based weakness in imports caused the trade gap to narrow. The value of petroleum imports fell $2.3 billion, and non-oil imports were off $3.7 billion.
- Although the weakness in imports may reflect sluggish growth in the U.S. economy, there was also statistical payback for outsized gains in February.
Q1 GDP Will be Revised Higher
- Exports of goods and services dropped $2.6 billion, which also reflects some statistical payback from strength during the previous month.
- The BEA had assumed the trade gap would narrow in March, but by less than it actually did. By itself, revised trade data would boost Q1 GDP from 0.6 percent to 1.3 percent.
Wachovia Corporation
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