The US’ trade gap shrank in July and a big three iron ore miner still has high production ambitions despite low iron ore prices.
Trade Deficit Shrinking
The US trade deficit fell in July to its lowest level in 5 months as exports rose, signaling underlying strength in the domestic economy amid concerns about a global growth slowdown.
The Commerce Department said the trade gap narrowed 7.4% to $41.9 billion, the smallest since February. When adjusted for inflation, the deficit fell to $56.2 billion from $59.0 billion in the prior month.
The smaller deficit implied a modest contribution to gross domestic product from trade early in the third quarter. Trade added 0.3 percentage point to the economy’s 3.7% annualized growth rate in the second quarter
Data ranging from consumer spending to employment and housing have suggested the economy retained much of its momentum from the second quarter and was on solid footing when global financial markets were rocked by turbulence triggered by worries over China’s economy.
Rio Still Bullish On Iron Ore Production
Rio Tinto Group said on Thursday it will continue to boost iron ore production but had yet to give construction approval for a new mine, Silvergrass, in Australia amid board promises to rein in spending. The mine is essential if Rio is to deliver its long-term $360 million metric ton global production target. Rio is on track to produce $340 million tons of ore this year.
The global miner said demand for iron ore would continue to grow despite current soft conditions and that half would be delivered via the seaborne market for at least the next 15 years, justifying an increase in tonnage.