Long Term Perspective
Export demand was sluggish in 1998 and 1999 as foreign economies in the throes of recession tried to get back on their feet. Export growth increased at a healthy clip in 2000 even as the foreign exchange value of the dollar appreciated. 2001 was not a good year for exports and this helped to dampen already weak domestic industrial production. The trade-weighted dollar has fallen dramatically over the past year; this could eventually spur export demand.

Short Term Perspective
Exports posted solid year-over-year gains from September 2002 through March 2003. Year-over year gains were less robust from April through August, but they are improving again. A declining dollar value in the foreign exchange market should bode well for export demand, but our trading partners are growing at an even more anemic rate than the U.S. so export growth could be limited for a few more months.

Real GDP vs. Final Sales   •   Real Consumer Spending vs. Real Income   •   Debt Burden vs. Savings Rate

Business Fixed Investment vs. Net Cash Flow   •   New Orders   •   Housing Starts vs. Mortgage Rates

Merchandise Exports vs. Trade Weighted Dollar   •   Merchandise Imports vs. Trade Weighted Dollar