U.S. trade gap widens in January as increasing oil prices take a toll
WASHINGTON — The U.S. trade picture dimmed at the start of this year as exports fell back and imports rose more than most expected. On both sides, it was all about oil.
The result was a sizable widening of the trade deficit in January to a seasonally adjusted $44.4 billion from a revised $38.1 billion in December, the Commerce Department said Thursday. Analysts on average had forecast a smaller trade imbalance of about $42.5 billion for the month.
On an inflation-adjusted basis, the January deficit was $48 billion. If it continues to grow, it will put additional strain on a domestic economy already burdened by higher payroll taxes and fiscal cuts under the socalled sequestration.
The January trade report showed that even though the U.S. may be on the path to energy independence one day — given the country’s trove of shale gas reserves and drilling techniques — the economy remains very much dependent on foreign petroleum.
Total U.S. imports of goods and services jumped a seasonally adjusted 1.8% in January from December, and that was entirely caused by increases in crude oil and other petroleum-related products.
U.S. exports, meanwhile, fell 1.2% in January after surging 2.1% in December. Here also, the drop was related largely to energy: The U.S. shipped less fuel oil and other industrial supplies.
American exports of other major categories — including farm items, cars and capital goods such as industrial machines — rose slightly over the month.
The U.S. merchandise trade deficit with Europe rose to $9.7 billion in January from $9.3 billion in December. Those figures are not seasonally adjusted, but U.S. exports to Europe, where many countries are in recession, were down about 5% in January compared with a year earlier.
The U.S. trade shortfall with China widened to $27.8 billion in January from $24.5 billion in December and $26 billion in January 2012. Making its own seasonal adjustments, Capital Economics said that the bilateral trade deficit with China appears to have hit a new record in January.
Paul Ashworth, an economist at Capital Economics, cautioned against reading too much into monthly data that can be volatile and especially into Chinese trade flows around the Lunar New Year holiday season.
Still, he said, “at face value, it doesn’t suggest that onshoring” — bringing back manufacturing from overseas to the U.S. — “is gaining much traction.”