US exports remain well below pre-pandemic levels, the Fed reported.

With many foreign economies still weak, US goods exports have not fully recovered from their previous sharp drops, while services exports remain depressed due to the continued suspension of most international travel.

By contrast, imports have made up most of the lost ground.

The reduction in imports of services has been offset by a total rebound in imports of goods, reflecting strong US demand for household goods.

Both the nominal trade deficit and the current account deficit, relative to GDP, have widened since 2019.

Exports

Import volumes remained well above export volumes through February, the Richmond Federal Reserve Bank (Fed) said.

Their contacts reported strong import growth and modest export growth, noting that export growth was limited by shortages of shipping containers.

In particular, import volumes for furniture, perishable foods, and toys were high.

Meanwhile, automobiles and lumber showed strength on the export side.

An airport contact reported that there are not enough cargo planes to meet demand, prompting companies to use passenger planes for cargo shipments.

Cargo movement

The Federal Reserve Bank of Atlanta transportation activity was consistent with the previous report from June 2021

The railroads had further improvements in overall traffic driven by double-digit increases in intermodal shipments.

In turn, freight brokerage firms reported strong demand and revenue growth as limited transportation capacity raised per-mile rates.

Port contacts noted record container volumes amid surges in imports and a surge in exports.

For their part, truck contacts continued to benefit from strong demand for consumer staples.

However, the driver shortage remained a constraint in the industry despite rising wages.

Lastly, relocation and inland barge contacts continued to experience challenges due to Covid-19, and a return to pre-pandemic activity levels is not expected until 2022 or beyond.

China

The Federal Reserve Bank of San Francisco said that retail sales growth has improved overall, in part due to the effects of the second round of tax relief transfers to households.

Online sales continued to be strong, as did sales from traditional grocery and convenience stores.

Real imports and exports of goods and services 

Although most contacts reported a reduction in foot traffic at retail centers, one contact in Southern California noted that thrift stores saw an increase in demand.

Car sales have continued to rise, although more purchases are made online than in person at car dealerships.

Contacts across the District noted supply chain disruptions and port delays, especially for imports from China.