When Will U.S. Exports Take Off?
The economic recovery from the COVID-19 pandemic has been uneven across countries and sectors. While U.S. imports have rebounded to surpass their level before the collapse in 2020, U.S. exports remain far below their pre-pandemic level. This asymmetry in part reflects the different sectoral compositions of imports and exports. U.S. imports are driven by goods trade, while exports rely more heavily on services trade. A key component of services exports is foreign travel to the United States, which has dried up due to the suspension of nonessential travel imposed in March 2020. However, U.S. exports may now be at a turning point given the reopening of U.S. borders to all vaccinated travelers on November 8. We analyze the trajectory of U.S. services and how the lifting of the travel ban might contribute to the rebound of U.S. services exports.