The gap expanded 4.8 percent to $42.3 billion as U.S. companies imported more automobiles and consumer goods, Commerce Department figures showed today in Washington. Imports and exports rose to the highest level since 2008.
The increase in trade flows showed a global economy that was strengthening before recent figures signaled a pause last month in growth in China, Europe and the U.S. The fallout from the European debt crisis may limit overseas demand, while an increase in the value of the dollar makes American goods less competitive abroad.
The deficit with China increased in May to the highest level since October, while imports from India were the most ever.
Exports from the U.S. to the rest of the world increased 2.4 percent to $152.3 billion, reflecting gains in industrial materials, business equipment and semiconductors. Imports rose 2.9 percent in May to $194.5 billion, led by an increase in demand for cars, pharmaceuticals, toys and clothing from abroad.
Today’s report showed the trade gap with China rose to $22.3 billion from $19.3 billion in the prior month. While the U.S. exported 2.5 percent more to China in May, imports from the Asian nation surged 12 percent.
The U.S. deficit with the European Union widened 7.5 percent in May as imports outpaced a gain in exports, today’s report showed.
In addition to making American goods more expensive to European buyers, the dollar’s appreciation will also weigh on sales in places where U.S. companies compete with European firms.
The quantity of imported petroleum declined, with the price per barrel falling to $76.93 a barrel, according to today’s report.
The balance adjusted for inflation, which is the figure used to calculate gross domestic product, increased to $46 billion in May. The gap was larger than the average $42.3 billion a month in the first quarter, putting trade on track to subtract from growth from April through June.