US goods trade balance shows a larger deficit of $85.9 billion than expected.
by VT Markets
/
Jul 29, 2025
In June, the United States reported a goods trade balance of $-85.9 billion. This was better than the expected $-98.4 billion.
The trade balance shows how much the U.S. imports versus exports. Keeping accurate records and predictions is essential for understanding the economy’s health.
June Goods Trade Balance
In June, the goods trade balance was $-85.9 billion, which is much better than the predicted $-98.4 billion. This suggests the U.S. economy might be stronger than we thought. Such a big difference in forecasts can create market opportunities.
The most immediate impact has been on the U.S. dollar, and we expect this trend to continue. The Dollar Index (DXY) has risen to a five-week high of 105.5, indicating that the market is responding to a more resilient economy. We should explore options that benefit from a stronger dollar, like call options on currency ETFs.
This encouraging economic news makes it harder for the Federal Reserve to lower interest rates soon. With June inflation steady at 3.1%, the central bank may keep its policies tight through the summer. Therefore, short-term government bond yields are likely to stay high.
Market Volatility and Opportunities
For the stock market, this situation creates mixed signals, likely resulting in range-bound trading and increased volatility. The CBOE Volatility Index (VIX) has risen from 12 to 14.5, indicating rising uncertainty. We see potential in buying options that profit from large price moves in either direction, such as strangles on the SPDR S&P 500 ETF.
A stronger U.S. dollar usually puts downward pressure on commodity prices, and we can see that now. The price of West Texas Intermediate crude oil has dropped below $82 a barrel, down from over $85 last month. We recommend buying put options on commodity-tracking funds to benefit from this downward trend.
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by VT Markets
Jul 29, 2025
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