Get ready for something we’re not quite used to — a growing US economy with a shrinking trade deficit.
2009 could see this happen since total US containerized imports are expected to drop 17.7% this year, to their lowest level since 2003. These falling volumes are what helped the US trade deficit shrink 5.5% last quarter.
Further out, even January 2010 imports are expected to fall 18% year over year according to IHS Global Insight. This would be the 31st consecutive month of import volume declines after years of double-digit growth.
Yes, it partly shows that the US consumer is weak, but for now these declines should be viewed more as a healthy re-balancing of US trade. Should this trend spill over into 2010, dollar bears might even find themselves in uncharted waters.