US trade deficit jumps to largest in 14 years in August

[WASHINGTON] The US trade deficit surged in August to the largest in 14 years with imports climbing again, suggesting that trade could be a drag on economic growth in the third quarter.

The Commerce Department said on Tuesday the trade deficit jumped 5.9 per cent to US$67.1 billion, the widest since August 2006.

Economists polled by Reuters had forecast the trade gap widening to US$66.1 billion in August.

Imports increased by 3.2 per cent to US$239 billion. Goods imports rose US$6.5 billion to US$203 billion. Exports increased 2.2 per cent to US$171.9 billion. Goods exports rose US$3.5 billion to US$119.1 billion.

The closely watched trade deficit with China decreased US$1.9 billion to US$26.4 billion in August.

A smaller trade bill contributed to gross domestic product over the last three quarters. The coronarivus crisis severely disrupted trade flows, which are now picking up.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

REUTERS