US trade deficit rises to highest level since January
- Author: Zachary Reyes Jun 02, 2017,
Jun 02, 2017, 22:49
The U.S. trade deficit rose in April to its highest level since January.
Despite falling oil imports and crude prices, the U.S. trade deficit saw its biggest jump in three months, increasing 5.2 percent or $2.3 billion compared to March to $46.7 billion. Consensus expectation was for the trade balance to widen a bit less to -$46.1 billion.
The gap between imports and exports in March was originally estimated at -$43.7bn. In contrast to goods, services exports moved up 0.2% on the month.
The value of foreign goods and services imported to the US climbed 7.5% in the first four months of this year compared with the same period a year earlier.
Consequently, the trade gap has widened 13.4% this year from a year ago.
The results were worse than the Can$30 million deficit forecast by economists, following a Can$936 million deficit in March (revised from the Can$135 million deficit first reported). Small increases in industrial supplies and materials (+1.2%) and capital goods (+0.1%) were not sufficient to offset the larger declines in the categories mentioned.
The strong dollar may be a factor in the latest increase in the trade gap.
A higher trade deficit lowers the official scorecard for the USA economy, known as gross domestic product. Consumers bought more cell phones, antiques and artwork from overseas. Add to this elevated policy uncertainty both globally and domestically and the outlook for US exports has more chance of downside than upside surprises going forward.
And exports fell marginally to $191 billion, with United States sales to foreign markets of consumer goods hitting their lowest level in 11 months at $15.7 billion. Exports of cars also fell. His administration has vowed to reduce the deficit, blaming it on abusive practices by America's trading partners.
Brian DePratto, a senior economist with TD Economics, said while the overall figures provide for a positive read of the economy, trade data can be volatile.