US trade deficit hits a new record as imports sharply outpace exports
The US trade deficit hit a new record of $109.8 billion in March fueled by strong demand for computers, vehicles, and oil, according to a report by the US Census Bureau released on Wednesday.
The report said exports in March amounted to $241.7 billion, rising $12.9 billion or 5.6% from February, while imports reached $351.5 billion, increasing $32.9 billion or 10.3% compared to the previous month.
The goods deficit increased by $20.4 billion to $128.1 billion, while the services surplus was $0.4 billion with the figures amounting to $18.3 billion.
Year to date the goods and services deficit rose 41.5% or $84.8 billion from the same period in 2021, with exports up 17.7% or $104.5 billion and imports up 23.8% or $189.3 billion.
The March figures show a deficit of $48.6 billion with China and $15.6 billion with the European Union.
The US in March imported more oil, autos, and consumer goods such as cell phones, clothes, furniture, toys, and computers.
On the other hand, exports of petroleum products, crude oil, fuel oil, and natural gas rose in the same month, as did autos and parts. Rising exports are being propelled by higher prices for oil.
A sharp hike in US imports in the first quarter was a big factor behind a 1.4% drop in the country’s gross domestic product (GDP).
Trade has subtracted from GDP for seven straight quarters. Imports of goods and services jumped 10.3% to $351.5 billion, outpacing a 5.6% rise in exports to $241.7 billion, said a Reuters report.
Earlier, economists had anticipated a trade deficit of $106.7 billion for March.
“The prevailing domestic and overseas economic environment could keep the deficit pinned near record levels and impose a significant headwind to US GDP growth,” economist Mahir Rasheed of Oxford Economics was quoted as saying in the MarketWatch report.