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When the the U.S. government’s first read on the economy’s growth during the first quarter of this year came out, I wrote that the trade highlights showed some tentative signs of normalization for CCP Virus-distorted flows of exports, imports, and for the resulting trade balances.

As of this morning, we have the second report on change between January and March in the gross domestic product (GDP), and the normalization trend still looks intact – but in weakened form.

The new data judged that first quarter growth in inflation-adjusted terms at an annual rate was a bit faster than previously estimated – 6.25 percent versus 6.24 percent. Yet the real combined goods and services trade deficit of $1.1939 billion annualized is 1.57 percent bigger than the quarterly record $1.1755 trillion reported a month ago.

As a result, the overall deficit a represented a 6.41 percent worsening from the fourth quarter figure, as opposed to the 4.77 percent increase previously reported. That’s still much lower than the 10.12 percent rise from the third quarter to the fourth quarter. And it’s orders of magnitude less than the 31.47 percent recorded during the spectacularly high growth second to third quarter period. But it’s definitely a step backward.

Ditto for the impact on after-inflation economic growth of the overall trade deficit’s increase. The initial read for the second quarter reported that the gap’s widening subtracted 0.87 percentage points from the 6.24 percent annualized total real GDP growth figure. In other words, constant dollar GDP growth would have been 13.94 percent greater had the real trade deficit not climbed at all.

Now the growth-killing impact of the trade shortfall’s expansion is pegged at 1.25 percentage points from 6.25 percent annualized price-adjusted economic growth. So that real GDP growth would have been 20 percent faster had the deficit not worsened. As with the increase in the deficit itself, the impact on growth of the deficit’s rise is smaller than it was in the fourth quarter – when it hit 35.92 percent for the worse, a multi-decade high. But the improvement is now a good deal smaller than first thought.

On a static basis, however, the inflation-adjusted adjusted total trade deficit’s share of the real economy keeps surging. This morning, it came in at 6.25 percent – as opposed to the 6.16 percent first reported. The fourth quarter level was only 5.97 percent and the third quarter’s just 5.48 percent.

Consequently, the real trade deficit is still bigger relative to the whole economy than during the fourth quarter of 2005, when it hit 6.10 percent. That incidentally was the previous record, and that time is of course known as the bubble decade – after which the financial crisis and Great Recession quickly followed.

Moreover, although signs of overall economic normalization keep mushrooming (thanks, e.g., to the spread of CCP Virus immunity and continued stimulus spending), trade flows may still be in for months more of pandemic-related distortions. Indeed, they may worsen.

After all, on top of all the stimulus the economy will keep receiving for the foreseeable future, two major bottlenecks crimping growth are easing. Specifically, progress is now being reported not only in clearing West Coast ports congestion, but in alleviating the global semiconductor shortage (albeit partly because the production cuts it forced on customers are cutting their demand).

It’s true that these bottlenecks – which have stemmed largely from the sudden stop-start nature of transitions from lockdowns to reopenings – have affected both U.S. exports and imports. But with the United States still a strongly consumer-dominated economy, and almost certain to recover much faster than many of its leading trade partners (many of which will therefore be relying on generating their own trade surpluses for growth more than ever), it’s all too easy to see how its trade deficits will either keep setting records or at least stay at their current lofty levels well into the next year.