Both exports and imports rebounded sharply in July, but the bigger gain in the latter means that the trade deficit widened to $63.5bn, from $53.5bn. Net external trade is on track to be a drag on third quarter GDP, but that will be offset by a positive contribution from inventories, so we still expect third quarter GDP growth will be 30% annualised.

Read the publication International Trade (Jul) on the Capital Economics Website.

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