10-03-06
The US trade deficit widened more than expected in January to a record $ 68.5
bn, as record imports fuelled by high oil prices outstripped record exports
propelled by stronger foreign demand, a Commerce Department report showed.
The monthly trade gap swelled 5.3 % from a revised estimate of $ 65.1 bn in
December. It also surpassed a median forecast of $ 66.5 bn by analysts.
But in a sign of improved economic growth overseas, US exports also increased
in January to a record $ 114.4 bn, up 2.5 % from the prior month. The export
rise was led by record shipments of industrial supplies and materials, capital
goods and auto and auto parts.
The biggest ever monthly deficit follows a record annual trade deficit of $
723.6 bn in 2005. The trade gap would exceed $ 800 bn in 2006 if it continued to
run at the pace set in the first month of the year.
Another report said the number of Americans filing new claims for
unemployment benefits unexpectedly rose to 303,000, the highest level since the
start of the year. The 8,000 increase in initial claims for jobless aid in the
week ended March 4 took them above 300,000 for the first time since the Jan. 7
week, the Labour Department said.
The increase pushed the four-week moving average of claims, which smooths weekly
volatility to provide a better picture of underlying trends, up by 6,250 to
293,500, a level economists still associate with a healthy job market.
High prices for imported oil helped push the trade gap to a record. The
United States ran an $ 8.4 bn deficit with the Organization of Petroleum
Exporting Countries, up 11.6 % from December. But analysts pointed out that
expensive oil is not the only reason behind the burgeoning trade gap. Overall
imports were $ 182.9 bn, up 3.5 % from December. Imports set records in several
categories, including food, feeds and beverages, industrial supplies and
materials, capital goods, autos and auto parts and consumer goods.
"You can't blame it all on energy because the trade deficit excluding petroleum
rose faster than the overall deficit. The main culprit once again continues to
be that imports are growing faster than exports," said Michael Sheldon, chief
market strategist at Spencer Clarke in New York.
The monthly trade gap with China widened 9.9 % to $ 17.9 bn in January. The
persistent deficit with China, the United States' largest with any single
country, has fuelled charges in Congress that China is an unfair trader that
manipulates its currency to gain a trade advantage. Manufacturers and
politicians have demanded that Beijing revalue its yuan currency.
Overall imports were $ 182.9 bn, up 3.5 % from December. Imports set records in
several categories, including food, feeds and beverages, industrial supplies and
materials, capital goods, autos and auto parts and consumer goods.
Source: www.usatoday.com