The United States’ largest manufacturing group says the country’s deepening deficit suggests the economic downturn has further to go.
“The March data do not show signs that the trade decline has yet hit bottom,” said Frank Vargo, vice president for international economic affairs at the National Association of Manufacturers.
Government data released Monday showed exports of manufactured goods fell 6 percent from February to March while imports fell 3 percent, expanding the manufactured goods deficit slightly to $25 billion.
“In the important capital goods sector, which accounts for close to half of U.S. manufactured goods exports, declines were registered in 25 of the 32 categories,” Vargo noted.
But the manufactured goods trade deficit still has declined some $147 billion since a year ago, suggesting “the manufacturing job loss experienced so far this year is due to the declining domestic economy, not trade,” Vargo said.
Vargo said the data shows free trade agreements are “a bright spot” for U.S. trade in manufactured goods. The U.S. had a $21 billion trade surplus in manufactured goods trade with its free trade partners last year, and preliminary data for 2009 show this surplus has grown this year.
Contact Alan Field at email@example.com.