U.S. trade deficit rises to $48.7 billion on record imports

Ivan Schwartz
December 6, 2017

October imports were $244.6 billion, $3.8 billion more than September imports.

The U.S. Chamber of Commerce said in a May report that they disagree "with the contention that the goods trade deficit is an appropriate gauge of whether a particular set of trade policies - or trade agreements - is delivering benefits to the American people more broadly".

Boosted by a weaker United States dollar, the October trade gap rose 8.6 per cent compared to September, to US$48.7 billion, the highest since January, surpassing analyst expectations for an increase of only 5.6 per cent. Imports are up 6.5 percent the first 10 months of 2017.

In exports, U.S. October exports to China were the highest since December 2013, exports to Mexico were the highest since October 2014, and exports to Brazil were the highest since October 2014. But that was overwhelmed by a $69.1 billion deficit in the trade of goods.

On the other hand, the Commerce Department said the value of exports edged down by less than a tenth of a % to USD195.9 billion.

Imports of goods also increased from Mexico to US$28.7 billion and from the European Union to US$39.4 billion.

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But trade deficits this year - which have reached $462.9 billion and are up 11.9 percent from last year - are on track to eclipse 2016 levels and will likely climb to more than $500 billion by year's end.

Strong U.S. consumer spending, buoyed by a tight labor market and sky-high confidence, has also helped drive the recent ramp-up in imports. Indeed, many US exporters have seen boosted profits in 2017 as a result.

Historically speaking, the USA imports more good than it exports, but runs a modest trade surplus for services.

President Donald Trump views America's massive trade deficits as a sign of economic weakness. Economists attribute the chronic trade deficit the US has faced for decades to Americans consuming more than they produce relative to the rest of the world's economies.

The White House is attempting to renegotiate the North American Free Trade Agreement, but has said it could walk away from the pact with Mexico and Canada if it can't broker what the administration sees as a better deal.

Other reports by GizPress

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