US trade gap up in January
March 9, 2006
The United States trade deficit grew by $3.4 billion in January from its December level, bringing it to a record level of $68.5 billion as imports grew much faster than exports. The bilateral deficit with China accounted for over a third of the growth in the overall trade deficit, growing from $16.3 billion in December to $17.9 billion in January. Another contributor to the deficit’s growth was oil imports that were up $1.2 billion in the month to $22.6 billion.
Imports into the US were up by $2.6 billion to $182.9 billion in January, while exports from the US to the rest of the world grew by only $2.8 billion to $114.4 billion. With this being the case, exports have to rise at a much higher percentage than imports to simply keep the gap from widening, but American businesses have not been able to keep up.
Some analysts don’t see the growth in the trade deficit turning around anytime in the foreseeable future, citing growing momentum in economies in Europe and Asia. Some policy makers in the US government have blamed the growing deficit on saving in the rest of the world rather than on US over consumption.
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