Trade Deficit in U.S. Widened in December

The trade deficit in the U.S. unexpectedly widened in December, reflecting a jump in petroleum imports that swamped an eighth consecutive gain in exports., Bloomberg 2/10/2010 10:48:14 AM

The gap widened to $40.2 billion during the month, the biggest in a year, from $36.4 billion in November, according to Commerce Department data. Imports increased 8.4 percent and exports climbed to the highest level since October 2008.

Faster economic growth in emerging countries and a drop in the dollar’s value that is making American goods more competitive may propel gains in sales overseas that will spur further gains in U.S. manufacturing. Efforts to rebuild inventories will probably also draw in goods from abroad, giving global trade a lift.

Excluding the influence of prices, which are the figures used to calculate gross domestic product, the trade gap increased to $43.7 billion in December from $40.9 billion the prior month. The increase may diminish the 0.5 percentage point contribution that trade made to economic growth last quarter when the government revises figures on gross domestic product later this month.

Imports increased to $182.9 billion, a 13-month high, from $174.5 billion in November. Purchases of petroleum from overseas climbed to $28.1 billion, the most since October 2008, reflecting higher prices and higher volumes.

Excluding petroleum, the trade gap was little changed at $16.7 billion compared with $16.5 billion in November.

Exports increased to $142.7 billion in December, the highest level since October 2008, from $138.1 billion the prior month. The 3.3 percent gain was the biggest since March 2007.

The increased was paced by sales of civilian aircraft, automobiles and part, petroleum products, cotton and industrial machines.

Trade Deficit in U.S. Widened in December