by Calculated Risk on 8/10/2005 11:10:00 AM

According to Briefing.com the market expects the trade deficit in June to be $57.2 Billion. The deficit for May was $55.3 Billion. My guess for June is $57.7 Billion.

PROJECTIONS:
I. Petroleum Prediction. I made an earlier prediction but I'm not happy with the BLS estimates. I'm going to lower the projection slightly to reflect the DOE estimates.

Forecast: Total NSA ERRP Imports: $19.46 Billion

Total SA ERPP FORECAST:
Imports SA: $19.3 Billion (seasonal factor estimated at 0.9925 for June)
Exports SA: $2.3 Billion
Balance ERPP: $17.0 Billion

Including petroleum exports and adjusting for seasonal effects, the SA oil balance for June is projected at $17.0 Billion. This compares to $15.8 Billion for May - an increase of $1.2 Billion.

II: For China, I project (see bottom) a NSA deficit of $16.3 Billion for June compared to $15.75 Billion in May. SA this is $16.3 Billion vs. $16.3 Billion for May (no change).

III. Japan. I haven't figured out how to estimate trade with Japan yet, but I suspect we will see a larger deficit in June than May for two reasons:

A) inbound port traffic at Los Angeles was up 7% over May and outbound traffic was down 9%. It appears that Long Beach trade fluctuates more with China and Los Angeles with Japan and other Asian countries. Based on these numbers I expect the deficit with Japan to grow by about $1 Billion in June.

B) Bloomberg: Japan's June Exports Rise 3.6%, More Than Expected

IV. OVERALL: I haven't developed a method for predicting the deficit for other countries, but based on Oil and China I think the deficit in June will be slightly higher than May's deficit of $55.3 Billion. Oil will be about $1.2 Billion more in June (than May), SA China will be approximately the same and Japan/Asia will add another $1 Billion.

My Guess (not enough work to call it a projection / estimate): $57.7 Billion Deficit.

NOTE: I expect July to be worse than June.

CHINA: The following is the estimate for trade with China based on this methodology.

CHINA TRADE BALANCE: Table numbers in Billions $

NOT SEASONALLY ADJUSTED

MONTH	NSA Balance	NSA Exports	NSA Imports
February	-$13.9	$3.08	$16.95
March	-$12.9	$3.3	$16.21
April	-$14.7	$3.4	$18.12
May	-$15.75	$3.3	$19.05
June	-$16.3(est)	$3.2(est)	$19.5(est)

SEASONALLY ADJUSTED (all estimates)

MONTH	SA Balance	SA Exports	SA Imports
February	-$18.1	$3.08	$21.19
March	-$15.1	$3.3	$18.42
April	-$15.5	$3.4	$18.88
May	-$16.3	$3.3	$19.6
May	-$16.3	$3.2	$19.5