Deficit Shows Disturbing Signs Ahead for Manufacturing: AAM Statement
Washington, D.C. – The Commerce Department released the latest monthly U.S. trade figures Thursday. The overall monthly U.S. international goods and services trade deficit decreased to $41.9 billion in July, from $45.2 billion in June, revised.
- This is the highest monthly trade deficit with China so far this year at $31.57 billion. Additionally, China made up fully 75 percent of our trade deficit in July.
- This report shows the highest ever level of imports in autos and auto parts at $30 billion.
- The monthly trade deficit with Japan widened to $5.7 billion.
- The monthly trade deficit with Korea widened to $2.6 billion.
Said Alliance for American Manufacturing President Scott Paul:
"While the overall trade deficit shrunk in July, I see disturbing signs ahead for manufacturing. Remember, China didn’t devalue the yuan until August, so look for continued deterioration of our trade picture with China. Auto imports—which hit a new record in July—are rising, thanks largely due to a strong dollar. Our trade deficits with mercantilist nations like Japan, China, and Korea are on the rise. If the Fed raises rates, the dollar could go even higher.
"Some important questions that could improve or worsen the prospects for factory workers could be answered over the next six weeks. Will Congress pass legislation to allow trade cases based on currency manipulation? Will our TPP negotiators insist on stronger rule of origin, market access, and enforceable currency disciplines? Will President Obama state unequivocally to Chinese President Xi that China will face robust sanctions not only for cyber hacks but also for other forms of trade cheating? And will the Treasury Department name China a currency manipulator in October?"