Trade data for August and January-August 2014

Bottom line: There is no substantive news in the August trade data. The main trends that have been evident since the beginning of the year, especially the weakness in exports, are at work and, indeed, intensifying. There is no evidence of a significant impact of the Gaza fighting on trade patterns.

  • As in July, the August trade deficit, denominated in US dollars, again rose in nominal terms to the highest monthly total for the year, whether measured using unadjusted or seasonally-adjusted data, or even trend data. By every measurement, the August deficit was several hundred million dollars larger than that of July.
  • The problem remains focused on exports, where the pace of decline has increased in each of the last three months (see graph).
  • Imports have also begun to decline. Here the weakness is centred on imports of raw materials, whilst the decline in imports of investment goods has faded — a potentially positive sign for the economy. Imports of consumer goods have continued to rise throughout the year.
  • All sectors of exports, as defined by technological intensity, are shrinking, but the medium-high technology industries show only a minimal decline.
  • In the high-tech sector, the computers and electronic products industries are leading the decline.
  • On a trend basis, exports from high-tech industries rose from some $1.6bn in August 2013 to over $1.76bn in December 2013 and January 2014, but have now fallen back to the $1.6bn level.
Graph: Monthly rate of change in imports and exports (excl. ships, diamonds, aircraft and fuels), Trend data (in percent), September 2013-August 2014
Graph: Monthly rate of change in imports and exports (excl. ships, diamonds, aircraft and fuels), Trend data (in percent), September 2013-August 2014

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