The US trade deficit increased by over 10.4% in November as a result of record imports fuelled by strong demand for foreign manufactured goods and the high cost of importing oil after another year of strong oil prices, marking the first growth in the trade gap in five months.
The US trade deficit increased in November by 10.4%, the first growth in the deficit in five months as a consequence of higher imports and import costs and weaker exports on previous months.
According to US Commerce Department figures, the trade deficit grew to $47.8 billion, fuelled by a growth in the value of imports. High oil prices accounted for a 3.7% rise in prices off of supply concerns and growing demand from emerging economies.
In addition to higher oil prices, US consumers imported more foreign cars than previously, encouraging a growth in imports at an overall rate of 1.3%, up to $225.6 billion.
The situation was worsened by a tail-off in US exports, which fell by just under 1.0% to $177.8 billion following weaker sales amongst some of the largest US industrial exporters. The combination of growing imports and weak exports has led to the deficit swelling faster than had been anticipated by many market analysts, showing more money leaving the US economy than anticipated and reflecting a growing dependency on foreign imports.
The US national debt has continued to rise in recent times as stimulus packages and increased borrowing commitments have required debt levels of some $15.5 billion, according to some forecasts.
While the trade deficit in general is showing a bleaker than expected picture, the US fared better against China, closing the gap to just under $27 billion after a surge in Chinese demand for US export goods and services.