Trade Deficit in U.S. Increased

The trade deficit in the U.S. widened in November more than anticipated as imports climbed faster than exports, pointing to a rebound in global demand that is fueling growth., Bloomberg 1/12/2010 11:24:15 AM

The gap expanded 9.7 percent to $36.4 billion from a revised $33.2 billion in October, Commerce Department data showed today in Washington. Imports increased 2.6 percent, reflecting a jump in oil prices, while exports rose to the highest level in a year.

Increases in spending by American businesses and consumers indicate purchases of foreign goods will keep rising in coming months. At the same time, a 12 percent drop in the dollar and growing economies overseas mean U.S. sales abroad by companies such as United Parcel Service Inc. and United Technologies Corp. may also improve, giving factories and the economy a lift.

Excluding the influence of prices, which are the figures used to calculate gross domestic product, the trade gap increased to $40.7 billion in November from $38.3 billion the prior month. The average gap for the quarter so far, at $39.5 billion, is little changed from the third-quarter average of $39.4 billion, indicating trade will not have much influence on economic growth in the last three months of the year.

Exports increased 0.9 percent, the seventh consecutive gain, to $138.2 billion in November, reflecting increasing demand overseas for food and American-made automobiles and semiconductors. The dollar is down 12 percent since reaching a five-year high in early March against a basket of currencies from the nation’s biggest trading partners.

Imports advanced 2.6 percent to $174.6 billion. Today’s report estimated petroleum prices rose to $72.54 a barrel in November, the highest level since October 2008. The increase in costs more than offset a drop in volumes as the U.S. imported 245 million barrels in November, the fewest since February 1999.

Americans also bought more consumer goods, computers and telecommunications equipment from overseas, signaling a revival in overall demand and business investment.

Trade Deficit in U.S. Increased