Slowing Surplus

One swallow doesn’t make a summer. One month’s economic statistics doesn’t make a trend.

The large drop in the trade surplus for February to $8.6 billion from $19.5 billion in January and $23.8 billion a year earlier is probably an aberration caused by the timing of New Year and the disruption to production and shipping from the severe winter, a point reinforced by the 6.6% rise in producer prices for the month (which in itself bodes ill for the next set of inflation numbers).

That all said, looking at the trend of the rolling 12 month surplus, it does seem that the surplus is at least slowing its pace of growth. Export growth is likely to slow to 15% this year while rising oil and other commodity prices will push up the import bill.

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