Measuring the U.S. trade deficit

The U.S. Commerce Department’s Census Bureau and its Bureau of Economic Analysis (BEA) jointly release the International Trade in Goods and Services report each month, which is a snapshot of the U.S.’s trade balance, or the gap between its imports and exports.

The trade balance report is one of two releases that focus on foreign trade, but unlike the current account balance report, which also includes foreign investment, the trade release only tracks the goods and services imported to and exported from the U.S.

The report isn’t as relevant as other economic indicators because its statistics are delayed by two months (i.e., January’s report contains November’s data), but its monthly release is more popular than the quarterly current account balance report. It hits the Street at 8:30 a.m. ET the second week of the month.

Traders tend to concentrate on the overall figures for each month (total imports and exports as well as the trade gap, or difference between them), but the report contains 18 detailed tables that break down U.S. trade in a variety of ways.

First, the announcement divides both imports and exports into either goods or services, and provides three-month moving averages of all four categories. The report then divides these groups further into smaller categories including six types of services, petroleum or non-petroleum goods, and dozens of industrial supplies and consumer products that range from nuclear materials to fruit. Finally, the trade balance report breaks out U.S. imports and exports by nearly 40 countries.

The Commerce Department directly tracks monthly changes in imported and exported goods, but it uses business surveys to compile its services data. The release provides both seasonally adjusted and raw data as well as nominal and real, or inflation-adjusted, statistics. Each report contains revised data from previous months, and annual revisions are released each June.