Hello, I'm Mark Pearson. While retailers enjoyed the sound of more coins hitting the bottom of the till consumers felt more pain at the pump and a bigger tug at the corner market.
For the tenth straight month, retail sales were up as consumers spent more for food, gasoline, clothing and automobiles.
Even with the good news for retailers economists worry growth could slow as consumers face higher prices for things like gasoline -- currently hovering a hairs-breadth below $4 per gallon.
All of these factors pushed the Consumer Price Index upwards but not enough for the Federal Reserve to be concerned about the inflation rate.
While retailers experienced another month of positive returns they - in-turn - paid more for raw materials as the Producer Price Index continued its seven-month upward trend. When the volatile food and energy categories are removed the core PPI also increased, continuing a year-long trend.
Despite pessimism over fuel and food prices consumers remain optimistic. According to an Associated Press-GfK poll more than two out of five people think the economy will improve.
Even with the new found optimism there is still a laser focus on our nation's debt. The U.S. government alone is leveraged to the point where 40-cents of every dollar spent is borrowed.
While the Federal Government's debt load increases, some in private industry are experiencing increased profits due to increased exports. Even with numbers that haven't been seen since the Clinton Administration economic forces are firming up for the trade gap to shoot over $560 billion this year.
Despite the biggest sale of U.S. goods overseas in nearly two decades, the U.S. trade deficit grew again in March. The gain was the sharpest one-month increase in nearly a year.
The Commerce Department said the trade deficit grew by 6 percent to $48.2 billion dollar and was mostly fueled by the spike in oil prices. America's oil bill jumped 18 percent in a month as the U.S. pumped in nearly 40 billion dollars in oil because of greater demand and steep price increases.
U.S. exports hit their highest level in nearly 20 years, mostly driven by a weaker dollar. Developing countries demand for U.S.-made autos, chemicals and agricultural goods contributed to $172.7 billion dollars in exports. USDA announced this week that U.S. farm exports reached an all-time high of $75 billion during the first half of this fiscal year, with the biggest market for American goods being China.
As of now, the U.S. is running a larger trade deficit than this time last year, which some economists believe will slow economic growth as more jobs go to workers in other countries.
While China is the largest holder of U.S. debt, the trade deficit with the Asian giant dropped slightly in March, but is expected to rise in the coming months. A major bone of contention between the two economic superpowers remains the rate of exchange between the Yuan and the Dollar. U.S. officials continue to pressure the Chinese government to let its currency float with the market.
Trade was the big topic this week at a high-level economic and strategic meeting between the two countries in Washington, D.C. Secretary of State Hillary Clinton along with several other government leaders met with their counterparts to discuss human rights and security crackdowns –among other issues- at the U.S.– China Strategic and Economic Dialogue.
Sec. Hillary Clinton, U.S. Department of State: "We all know that fears and misperceptions linger on both sides of the Pacific. I will be very open about that. Some in our country see China's progress as a threat to the United States. Some in China worry that America seeks to constrain China's growth. We reject both those views. We both have much more to gain from cooperation than from conflict. The fact is that a thriving America is good for China and a thriving China is good for America."