Hovering imports push United States commerce deficit to nine-year excessive

Posted February 07, 2018

Even though Trump administration has made the goal to narrow the trade gap through his "America First" trade policies, it is really hard to achieve when the domestic economy is expanding and the customers' appetite for foreign-made products is strong.

The surge in the December trade deficit was flagged by an advanced goods trade deficit report published in late January.

For the full year, total US exports rose 5.5 percent to $2.33 trillion, while imports climbed 6.7 percent to a record $2.9 trillion. For the entire year, the trade gap jumped 12.1 percent to a nine-year high of $566 million, according to data released by the Commerce Department Tuesday.

Trade was a hallmark issue of President Donald Trump's campaign.

The U.S. trade deficit increased by more than $61 billion in 2017, the Commerce Department announced on Tuesday - an expected rise that sparked wildly different reactions and interpretations of the Trump administration's effect on the economy.

At the same time, the United States recorded a record level of exports to 29 countries, including Mexico (243 billion), China (130.4 billion) and the United Kingdom (56.3 billion).

The increase in the trade deficit is highly sensitive at present given the Trump administration´s current crusade to simultaneously boost economic growth but improve the balance of trade.

Imports for December were up by $6.2bn versus November. On the campaign, Trump was a vociferous critic of current USA trade practices with China, but since he took office, he shifted his tone because he hopes the Chinese government will help reduce tensions with North Korea. The economists interviewed expected a low value of 52.2 billion United States dollars. Total imports rose 2.5 percent sequentially, driven by consumer goods and automotive.

In 2017, "the goods deficit with China hit a record $375.2 billion" and the deficit with Mexico swelled to $71.1 billion, up from $55.6 in 2016.

"It was a flat month and not a great handover into 2018".

Trade deficits are caused when a country's imports exceed its exports.