United States Goods Trade Balance

Goods Trade Balance is part of the country's trade balance. It is the difference between imports and exports of goods in the given month in monetary terms.

Economists use the indicator to measure the activity of the manufacturing sector and the intensity of foreign trade flows.

A nation importing more goods and services than it exports has a trade deficit. For countries with highly developed economies, like the US, it means that labor-intensive production is transferred abroad, thus restraining inflation and maintaining high standard of living. When exports exceed imports, economists point to a trade surplus. It is an indication of high production level. It also shows that the nation produces more goods than it can consume.

The impact of the trade balance on dollar quotes is ambiguous and depends on the context of business cycles and other economic indicators, for example the dynamics of GDP. For example, in economy recession conditions, countries begin to export more in order to create jobs. Conversely, if the economy grows rapidly, developed countries prefer to develop imports in order to ensure price competition. These developments affect dollar accordingly.