U.S. Exports & Imports of Goods - June 15, 2009

Weekly Market Insight

Since peaking last July, the dollar volume of goods exported from the U.S. plunged by 32 percent through April—the most recent data available—while import volume slipped by 38 percent. Most of the decline came in 2008 with some leveling off in evidence early this year. As a result of the larger decline in imports, the trade balance of goods retreated by more than half, from $77.2 billion in July to just $37.2 billion in February before increasing slightly to $40.1 billion in April. Trade in services, comprising 34 percent of total exports and 20 percent of imports, also declined but by a lesser amount. The precipitous fall in global trade is a byproduct of the recession, tighter credit and deleveraging by businesses and households. It is one of the main causes, along with the drop in retail sales and business capital spending, for the unprecedented decline in absorption of industrial space, which totaled negative 40 million square feet in the first quarter. The silver lining is that the trade report is released with about a six week lag. Other, more timely indicators suggest the pace of economic deterioration has moderated since the spring with a turnaround in view for later this year. Expect trade figures, along with demand for industrial space, to remain weak for the remainder of 2009 before mounting a gradual recovery in 2010.
*Seasonally adjusted, balance of payments basis
Source: U.S. Census Bureau, Grubb & Ellis

Robert Bach, Senior Vice President, Chief Economist, has 30 years of professional experience in real estate market research, consulting and city planning. His commentary on the real estate markets is provided here on a weekly basis.
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