Steve Blitz Morning Notes

The headline number showed the trade balance worsening by $996 million in March and the culprit was oil prices. The balance of trade in services improved by $813 million and the balance of trade in goods net of oil improved by $296 million – a $1.1 billion improvement in the balance of trade. As far as GDP accounting is concerned, the headline number, which includes oil, is what counts. But when counting on an export driven recovery and the impact of that on the rest of world, it is the non-oil deficit that matters. All in all, strong export growth is the reason why business spending is up along with rail traffic in containers. So far so good, but there are quite a few black swans swimming around in the middle of the pond. Continued positive momentum in trade is anything but assured.