Washington (AFP) – The US trade deficit expanded in February by more than analysts expected to reach its highest level since April 2023, as imports once again exceeded exports, according to government data published Thursday.
The overall trade gap grew to $68.9 billion, up $1.3 billion from a month earlier, the Commerce Department said in a statement. This was above market expectations of a slight decrease in the trade deficit, according to Briefing.com.
The February increase reflected a $7.1 billion rise in imports from a month earlier, which was counteracted by export growth of just $5.8 billion, meaning the overall trade gap rose. Among the rise in goods exports, civilian aircraft and crude oil exports saw big increases, while imports were boosted by consumer goods including cell phones and other household goods, and foods, feeds, and beverages.
“The real deficit is $86.5B quarter-to-date versus $84.4B in the previous quarter, suggesting a small drag from trade on growth in Q1,” High Frequency Economics chief US economist Rubeela Farooqi wrote in a note to clients. “The outlook for trade flows going forward is likely one of moderation given expectations of slower global demand and growth going forward,” she added.
The United States’s trade deficit with China shrank to $21.9 billion, but remained the widest of any country, while the trade deficit with Mexico surged to $15.3 billion. The continued gap in trade between the world’s two largest economies likely to be on the mind of Treasury secretary Janet Yellen, who is on her second visit to China in less than a year in which she will raise concerns about overcapacity in certain sectors.
“We’re concerned about the spillovers that Chinese subsidies to these industries are having on the United States, and other countries as well,” Yellen told reporters on Wednesday.
© 2024 AFP
