US trade deficit hits 10-year high; job growth slowing
WASHINGTON: The US trade deficit jumped to a 10-year high in October as soybean exports dropped further and imports of consumer goods rose to a record high, suggesting the Trump administration’s tariff-related measures to shrink the trade gap likely have been ineffective.
Other data on Thursday showed private employers hired fewer workers than expected in November, pointing to a moderation in the pace of job growth. That was reinforced by another report showing a small decline in the number of Americans filing claims for unemployment benefits last week.
Separately on Thursday, the ADP National Employment Report showed private payrolls rose by 179,000 jobs in November after a downwardly revised increase of 225,000 in October.
The Commerce Department said the trade deficit increased 1.7 per cent to $55.5 billion, the highest level since October 2008. The trade gap has now widened for five straight months. Data for September was revised to show the deficit rising to $54.6 billion instead of the previously reported $54.0 billion.
The politically sensitive goods trade deficit with China surged 7.1 per cent to a record $43.1 billion in October.
Economists polled by Reuters had forecast the overall trade deficit rising to $55.0 billion in October.
When adjusted for inflation, the goods trade deficit increased to $87.9 billion in October from $87.2 billion in September. The so-called real trade deficit is above the average for the third quarter.
Trade subtracted 1.91 percentage points from GDP growth in the July-september quarter. Growth estimates for the fourth quarter are around a 2.8 per cent annualised rate. The economy grew at a 3.5 per cent pace in the third quarter.
In October, exports of goods and services slipped 0.1 per cent to $211.0 billion. Soybean exports, which have been targeted by China in the trade dispute and have been dropping for the last several months, fell $0.8 billion. Exports of civilian aircraft and engines also fell.
* Trade deficit widens to
$55.5 billion in October * Exports fall 0.1 per cent;
imports rise 0.2 per cent * Private payrolls increase
179,000 in November * Weekly jobless claims fall
4,000 to 231,000