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US November trade data

Brad Setser | Jan 12, 2006

$64.2 billion is not $68.1 billion.   But it is still kind of large.   Another $65 billion deficit in December, and the annual trade deficit will reach $726 billion.  

That works out to a fourth quarter trade deficit of $197.5 billion, and, by my estimates, a quarterly current account deficit of $229.5 billion (I estimate transfers at -22, and income at -10).   Sum that up, and the current account deficit for 2005 will come in around $821 billion.

A $65 billion trade deficit over all of 2006 would generate a trade deficit of $780 billion, and, by my estimates, a current account deficit of $940 billion.    That is - in my estimation - what happens even if exports grow fast enough to keep the average quarterly 2006 trade deficit in 2006 at a level slightly below its likely level in the fourth quarter of 2005.


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