The US trade deficit widened more than expected in September as imports rose to their highest level in almost a year, which could probably see third-quarter growth estimates trimmed.
The Commerce Department said the trade gap increased 8% to $41.8 billion, the largest since May.
August's shortfall on the trade balance was revised slightly to $38.7 billion from the previously reported $38.8 billion.
Economists polled by Reuters had expected the trade deficit to widen a bit to $39 billion in September.
When adjusted for inflation, the trade gap widened to $50.4 billion, the largest since May, from $47.4 billion the prior month. This measure goes into the calculation of gross domesti cproduct.
The increase in the "real" trade deficit in September suggested the government will probably lower its initial third-quarter GDP estimate.
Trade contributed 0.31 percentage point to the economy's 2.8% annualiSed growth pace in the three months from July to September.
The US trade deficit had held steady since plunging in June as both domestic and global demand remained sluggish.
Exports of goods and services slipped 0.2% to $188.9 billion in September. That was the third month of declines in a row.
Imports rose 1.2% to $230.7 billion, the highest level since November last year. Imports of cars and parts were the highest on record.
But with consumer spending having slowed significantly, some of the imported goods could end up piling up in warehouses. That could make businesses reluctant to keep on rebuilding stocks and the slowdown in inventory accumulation would undercut fourth-quarter GDP growth.
Today's figures show that imports from China increased in September, lifting the contentious US trade deficit with China to a record $30.5 billion.
US jobless claims fall, but prior week revised higher
The number of Americans filing new claims for unemployment benefits fell last week, but an upward revision to the prior week's figure suggested the labour market recovery remained gradual.
Initial claims for state unemployment benefits fell 2,000 to a seasonally adjusted 339,000, the Labor Department said today. Claims for the prior week were revised to show 5,000 more applications received than previously reported.
Economists polled by Reuters had expected first-time applications to fall to 330,000 last week.
The four-week moving average for new claims, which irons out week-to-week volatility, dropped 5,750 to 344,000.
Lacklustre domestic demand is preventing the labour market from generating stronger jobs growth that would decisively lower the unemployment rate.
Employers added 204,000 new jobs to the payrolls last month, but a 16-day government shutdown temporarily pushed the jobless rate up by a tenth of a percentage point to 7.3%, the Labor Department said last week.
The claims report showed the number of people still receiving benefits under regular state programmess after an initial week of aid was unchanged at 2.87 million in the week ended November 2.