ShareEach day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update highlights the trade balance and consumer sentiment.
- The trade deficit grew in December to $48.8 billion from $47.1 billion in November. A larger deficit means less GDP. However, both imports and exports have been growing, which is a sign of overall economic recovery.
- During the recession, both imports and exports plummeted with imports falling more. This led to a smaller trade deficit, which boosted GDP growth.
- More recently, both imports and exports have recovered with imports recovering slightly more. Imports in December were 11.3 percent higher than the previous year while exports were 9 percent higher. Compared to December 2009, imports and exports were 25 and 24.8 percent higher, respectively. This has led to a slightly larger trade deficit and a slight drag on GDP.
- In other news, preliminary February consumer sentiment data show some consumer concern. The index dropped from 75.0 in January to 72.5 in February. As recently as September the index was in the 50s.
- Consumer assessment of current conditions retrenched to its December level after advancing considerably in January. Consumer expectations slipped slightly but remain higher than any month since last spring. A final reading will be released toward the end of February.
- GDP forecast based on today's and recent data suggest a slowdown in economic growth. In the fourth quarter of 2011, GDP grew by 2.8 percent, but it is expected to grow by 1.5 to 2.0 in the first quarter of 2012.
