U. S. Services Trade Surplus is Expected to Decline in 2001 According to University of Michigan Forecast
May 29, 2001
The U.S services trade surplus, which had resumed its growth after declining in the aftermath of the 1997 Asian Financial Crisis, is due to fall once again in 2001. The forecast done by the University of Michigan and funded with a grant from the Mark Twain Institute, expects services exports to grow at an annual 3% rate, which is slower than the 8.9% annual growth posted in 2000. Imports growth is also expected to slow in 2001 with respect to 2000, but it will register a solid 4.6% that explains the drop in the trade balance this year.
The forecasts are based in the expectation that the U.S. economy will continue to cool down and that its main services trading partners Mexico, Canada, United Kingdom, Germany and Japan will also register a slower growth rate in 2001. The dollar is also expected to remain strong against a basket of currencies of these five countries until the mid quarter of 2001.
Us services exports of transportation services are expected to register negative growth in 2001, while all other sector will register slower growth rates than those posted in 2000. U.S services imports are expected to grow in all categories in 2001, albeit slower than 2000.
The full forecast will be featured in the website soon.
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