The U.S. advance indicators report
The U.S. advance indicators report revealed a surprise September widening in the trade gap for goods thanks to a bigger upside import than export surprise, leaving a fifth straight rise for imports and an export pop after three straight declines. Analysts also saw a surprise September inventory gain of 0.1% for retailers alongside a firm 0.3% wholesale inventory rise, following 0.1% trimmings for both in August. Our GDP estimates now show growth of 3.2% in Q3 and 3.0% in Q4, versus a prior 3.1% for both. For September trade in goods, the advance deficit widened back to the $76.0 B cycle-high last seen in February, from $75.5 B in August via the last goods and services trade report. Analysts saw a 1.8% rise for exports and a 1.5% increase for imports, after respective August figures of -1.3% and 0.8%. The advance goods data imply a September widening in the goods and services trade deficit to $54.0 B from $53.2 B, versus a $55.0 B cycle-high in February, with 1.3% gains for both exports and imports. For inventories, the 0.3% August wholesale inventory rise followed a 0.9% (was 1.0%) August gain, alongside a 0.1% retail inventory rise with a 0.1% ex-auto drop that followed respective August figures of 0.6% (was 0.7%) and -0.1% (was zero), leaving a net overshoot for the two sectors. An estimated 0.5% factory inventory rise implied a 0.3% September business inventory gain.