Widen­ing Trade Gap May Slow Third-Quar­ter Growth

The Bond Buyer - - Market News - — Mar­ket News In­ter­na­tional

The U.S. in­ter­na­tional trade gap widened to $50.1 bil­lion in July from $45.7 bil­lion, a wider gap than the $50.0 bil­lion deficit ex­pected and the largest monthly in­crease since March 2015, data re­leased by the Com­merce De­part­ment Wed­nes­day morn­ing showed.

The over­all July trade gap ex­ceeded the sec­ond-quar­ter av­er­age, as did the cen­sus goods gap and the chained trade gap. If the trade gap does not nar­row in Au­gust or Septem­ber, net ex­ports could be a drag on third-quar­ter growth.

The trade gaps with China and the EU both hit record high lev­els in July, am­mu­ni­tion for those in fa­vor of fur­ther tar­iffs. The gap with Canada also widened this month, while the gap with Mex­ico nar­rowed.

Both were wider than a year ago.

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