US trade deficit at widest level in 10 years
Data shows fall in exports to China
The US trade deficit hit its widest level in a decade in October as the nation registered a record amount of imports and a decline in exports to China.
The Department of Commerce said Thursday the gap between US imports and exports grew 1.7 per cent month-over-month to $55.5bn, the most since October 2008 and the fifth straight month of deficit expansion. Economists polled by Thomson Reuters anticipated a smaller deficit of $55bn.
For September, the US trade deficit was revised to $54.6bn from $54bn.
America’s goods trade deficit with China, which has come under a microscope amid a trade spat between the world’s two largest economies, jumped 7.1 per cent to $43.1bn.
In a back-and-forth exchange of new tariffs, the US has levied import duties on $250bn of Chinese goods in a bid by President Donald Trump to convince Beijing to make economic reforms. Mr Trump has also deployed tariffs on foreign steel and aluminium. China has retaliated with tariffs on politically sensitive goods such as soyabeans, vehicles and orange juice.
Mr Trump and Chinese president Xi Jinping reached a 90-day truce last weekend that called for the two sides to restart negotiations. Under the deal, the US will hold off on carrying out a threat to impose additional tariffs, and China agreed to reduce tariffs and other trade barriers.
US soyabean exports fell by $0.8bn in October, while exports of civilian aircraft and foods, feeds and beverages also declined. Industrial supplies and materials exports rose $0.3bn. Exports of services were up $0.1bn, driven by financial and other business services.
Vehicles, pharmaceutical preparations and travel services lifted imports by 0.2 per cent to $266.5bn, the highest on record.
Adjusted for inflation, the October trade deficit was $87.9bn, up from $87.2bn in the prior month.