US trade gap widens sharply in September
Washington (AFP) - The US trade deficit increased sharply in September as imports swelled but exports fell, pointing to weak demand in the tepid global economy, government data released Thursday showed.
The Commerce Department said the US international trade gap widened to $41.8 billion, the biggest gap since May and much larger than the $39.1 billion figure analysts expected.
The department revised the August figure slightly downward to $38.7 billion, previously estimated at $38.8 billion.
September marked the third consecutive month of a widening trade gap. US imports jumped $2.7 billion from the prior month to $230.7 billion, all of it in goods imports, led by industrial supplies and materials, automobiles and parts, and capital goods.
Imports of services declined, reflecting a decrease in travel.
Exports fell to $188.9 billion from $189.2 billion in August, with both goods and services exports declining. Americans exported fewer industrial supplies and consumer goods but saw increases in foods, feeds and beverages.
"The trade data suggest that external demand for US goods is weak, reflecting a lackluster global economy, but US domestic demand is resilient," Moody's Analytics said.
Ian Shepherdson of Pantheon Macroeconomics said the report was "worse than expected" and implied the Commerce Department would downwardly revise its estimate for third-quarter economic growth, initially seen at an annual rate of 2.8 percent.
The goods deficit was $2.5 billion higher than the department first estimated, "implying a 0.24 percent downward revision to headline GDP growth, other things equal," he said.
The September data showed little movement from a year ago. Exports were up 1.1 and imports were up 1 percent from September 2012.
The politically sensitive enormous trade deficit with China rose two percent from August to $30.5 billion, as Americans snatched up Chinese goods. In the first nine months of the year, the deficit totaled $238.2 billion, putting it on track to exceed the 2012 record $315.1 billion gap with China.
The Treasury Department in late October charged that China's yuan currency remains undervalued, which would give the manufacturing superpower a trade advantage. But the Treasury stopped short of branding China a currency manipulator, a designation that could trigger sanctions.
The US trade deficit with the European Union fell to $8.0 billion from $9.8 billion in August.
But it climbed with the country's top North American trade partner, Canada, to $3.2 billion from $2.4 billion.
