Trade data published by the U.S. Census Bureau indicates a small improvement in the level of trade between the U.S. and China. The positive development coems a month after the year-over-year growth rate of trade between the U.S. and China slowed dramatically in May 2021 to its lowest level since it stopped shrinking in September 2020.
The following chart shows where the recovery of trade between the U.S. and China stands through June 2020.
The size of that monthly gap peaked at $10.6 billion in October 2020 and had fallen to $7.4 billion through May 2021 as the trade recovery gained steam. The gap for June 2021 is $7.3 billion, changing little from the previous month, or even the month before that, as the growth in the volume of trade stalled.
Remarkably, the actual trajectory of the trailing twelve month recovery of trade between the U.S. and China is paralleling the counterfactual we generated in early 2020 to project the expected recovery of trade between the two nations following the Trump administration's "Phase One" agreement in January 2020. Behind the scenes, we discovered we can directly overlay the counterfactual to match the actual trajectory for the combined value of U.S.-China trade, provided we start its tracking from the low point in the actual trajectory established in August 2020.
That result suggests the size of the gap between the counterfactual shown on the chart and the actual trajectory is stabilizing. If so, that outcome would mean the coronavirus pandemic has done lasting damage to the economies of both nations, with the combined level of trade between them revealing that impact.
References
Board of Governors of the Federal Reserve System. China / U.S. Foreign Exchange Rate. G.5 Foreign Exchange Rates. Accessed 6 August 2021.
U.S. Census Bureau. Trade in Goods with China. Accessed 6 August 2021.