(menafn – ecpulse)
Ahead of the U.S elections we watch another mixed week be drown regarding the current economical conjuncture of the worlds leading economy with a worsened and widened trade deficit along with better labor and confidence data, yet the recovery is on a slow gradual pace and accordingly a full efficient healing is still far from being witnessed.
In fact throughout the week we watched mixed sentiments getting spread as on one hand the superpowers trade gap widened more than forecasted on higher imports and on the other hand the countrys jobless claims cheerfully and unexpectedly declined faintly to confirm once again that the labor conditions are improving gradually but remain far from a full recovery and that the gap between imports and exports continue on being immense.
Actually the U.S trade deficit widened more than forecasted in March to having in fact the deficit extend to 51.8 billion; higher than the market predictions of a 50.0 deficit and from a prior revised deficit of 45.4 billion as the demand mainly for imported crude oil, computers, automobiles and televisions reached a record high; jumping by 5.2 percent, which is the biggest in more than a year.
Imports from China only rose by 12 percent within that month while we should not forget that the cost of crude oil imports in March inclined to 29.2 billion from actually 23.4 billion the prior month, yet the import price index for April fell by 0.5 percent from a prior revised increase of 1.5 percent from 1.3 percent.
Yet it is essential to say that exports have also gained by 2.9 percent, which is as well a record high as sales by American companies to its major trading partners as Mexico, the European Union and South Korea reached the highest ever, still of course the gap between the exports and imports remain powerfully unbalanced and accordingly this record in exports is truly reflect throughout the countrys deficit.
On the other hand we saw the countrys initial jobless claims of May 05 decline happily to 367 thousand from 368 thousand; slightly below the market forecast of 368 thousand, which is in fact the lowest level reached in one month and a clear sign that the enhancement so far detected in the labor sector is still on track but at a slow gradual pace and therefore it remains insufficient to provide this key sector with a full recovery.
Plus for the first time in four month we watch the superpowers wholesale prices fall in April, which is mainly resulted by the recent slight plunge of fuel costs, yet as an overall portrait price pressures remain around stable levels and continue on being well subdued while that the countrys territorial neighbor; Canada, reports a slight higher jobless level.
If truth be told the countrys producer price index fell 0.2 percent from a prior neutral reading of 0.0 percent; lower than the projected reading of 0.0 percent as a result mainly of the recent decline in fuel prices, while that the Core PPI came in lower as forecasted at 0.2 percent from 0.3 percent for the same period.
And accordingly this suggests lower final products being offered to the American public and may therefore permit the demand to strengthen further while encouraging the Federal Reserve to stick to its low interest rates till late 2014 since that so far no high inflation or deflation threats are being showed and actually prices pressures remain on flowing within controlled limits.
No wonder we watched the towards the end of the week a report showing that the confidence regarding overall business and economical conditions of the worlds leading economy with in fact the preliminary reading of the University of Michigan Confidence rising up slightly to 77.8 from 76.4 within the month of May.
As for the superpowers major trading partner and neighbor; Canada, it was able to add once again 58,200 workers to its labor force in April after a prior significant add of 82,300 workers in March, which was the biggest since September 2008, yet this remains quite insufficient as the countrys jobless levels rose faintly to 7.3 percent as already projected by the market from 7.2 percent.