U.S. trade flows continue to come back to earth after pandemic-related disruptions. The overall trade balance widened by $1.3 billion to -$65.0 billion in July, but that comes after large upward revisions leave the balance narrower over the past few months. Revisions help bring the monthly data in line with quarterly net exports in the GDP accounts, which previously suggested a larger drag from trade in Q2.

Given monthly volatility in trade flows, it is still early yet to back into a precise read on Q3 trade. In real terms, exports rose 1.1%, while imports were up 1.8%. But coming off of a modest drag in Q2 and having fairly neutral assumptions in the remaining months of the quarter suggests net exports will provide a modest boost to Q3 headline GDP growth.