The list of imports into the U.S. was shaken up in May, with gold surging 1,700% from 2019 to now stand at the top import. Here's what's behind the change.
Released last week, the
Census Bureau's much-anticipated report lived up to expectations, if only in
terms of impact. Perhaps the most shocking number in the report pertained to
U.S. trade data, revealing that April's 20.91% year-to-date plunge in trade was
followed by a 29.83% plunge in May. There were upsides, too, such as the
government's announcement that it posted 4.8 million jobs in June and signs
that the domestic trade deficit is shrinking.
Yet whatever the
upsides seem to be, Forbes contributor Ken Roberts believes that a closer look
into the trade data reveals some major
red flags that are likely being overlooked. As Roberts notes, U.S. exports
made up for only 36% of overall U.S. trade in May, which might be the lowest
export-to-import ratio on record. As Roberts explains, the trade deficit doesn't
paint an accurate-enough picture of the economy, and it appears to be masking one
of the biggest monthly falls in exports relative to imports ever.
The curiosities related
to the trade data don't stop there, though, as an overview of the goods that
are being brought in has made international trade look closer to a portfolio
reassessment. Normally, computers are the top U.S. import, with passenger vehicles
not trailing too far off. In May, however, imports of foreign vehicles fell by
a massive 76.88% compared to the same month last year.
Meanwhile, gold replaced
computers as the top U.S. import for the month, with the value of gold imports
increasing some 1,700% compared to the previous months of May.
These numbers somewhat
tie into both the intense demand for physical gold in recent months and supply
shortages in key places. As Switzerland, a top gold processor and exporter, all
but closed up shop due to safety precautions, worries over supply
escalated. What started as a supply concern among bullion buyers soon
translated to questions over whether there would be enough physical gold to
cover the metal's derivatives.
But even the
well-documented scramble to obtain bullion by virtually every party over the past
few months might not have prepared analysts for the import figures. $3.07 tons
of gold were brought into the U.S. in March, followed by $7.54 billion in April
and $8.77 billion in May. In the past decade, monthly gold imports into the
U.S. exceeded $2 billion on just three occasions. Furthermore, the combined
bullion imports between March and May eclipsed 2016's annual figure, which was
the highest on record.
