Imports jump widens US trade gap

Friday 13 November 2009 13.46
Oil - Higher prices help push up US deficit
Oil - Higher prices help push up US deficit

US government figures show that the country's trade deficit widened in September by an unexpectedly large 18.2%, the biggest jump in more than 10 years. The wider gap came as oil prices rose for the seventh straight month and imports from China bounded higher.

The monthly trade gap grew to $36.5 billion, from a slightly revised estimate of $30.8 billion in August. Wall Street analyst had expected the shortfall to grow modestly in September to around $31.65 billion.

Both US exports and imports had their best month since December 2008. But in a sign of renewed US economic growth, imports grew 5.8% in September, the biggest monthly gain since March 1993, while exports rose 2.9%.

Imports of industrial supplies and materials showed the biggest gain, suggesting that US manufacturers are ramping up for production.

The average price for imported oil leapt to $68.17 a barrel and imports from OPEC increased to $11.9 billion in September, both the highest since November 2008.

The closely watched trade deficit with China widened 9.2% to $22.1 billion as imports grew 8.3% to $27.9 billion, both also the highest since November 2008.

The overall US trade deficit, including with China, has fallen significantly this year in response to the worst economic downturn in decade.