Preview: Due July 7 - U.S. May Trade Balance - Advance goods data shows deficit up sharply
We expect a May trade deficit of $78.7bn, up from $55.9bn in April and the widest deficit since a pre-tariff record of $133.0bn in March 2025. We expect a 3.4% decline in exports after four straight gains and a 3.1% increase in imports, which would be a fourth straight gain.
Advance goods data has already been released, showing a 5.4% fall in exports and a 3.6% increase in imports. We expect goods data to be consistent with this. With export prices having risen by 1.3% this implies a sharp fall in export volumes while import prices rose by 1.9%, explaining over half of the imports gain.
We expect services to show a 0.8% rise in exports after a weak 0.4% decline in April while service imports maintain a firm trend with a rise of 1.0%. Service exports will still rise by more in USD terms, bringing a marginal increase in the services surplus to $27.9bn from $27.8bn. We expect a goods deficit of $106.6bn, up from $83.7bn in April.
