US trade gap widened in March as imports outpaced exports
The value of imports rose 2.3 per cent, reflecting a rise in inbound shipments of motor vehicles and consumer goods
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THE US trade deficit widened in March as an increase in the value of imports exceeded exports in a sign of solid consumer and business demand.
The gap in goods and services trade grew 4.4 per cent from the prior month to US$60.3 billion, Commerce Department data showed on Tuesday. The median estimate in a Bloomberg survey of economists called for a US$61 billion deficit.
The value of imports rose 2.3 per cent, reflecting a rise in inbound shipments of motor vehicles and consumer goods. Imports of capital goods also rose as the build out artificial intelligence boosted demand for foreign-made computer equipment.
Exports increased 2 per cent in March from the prior month, helped by an increase in shipments of oil and other petroleum products, while consumer goods declined.
The March figures wrap up a quarter in which net exports weighed on gross domestic product by the most in a year.
The war in Iran and effective closure of the Strait of Hormuz, a chokepoint for about a fifth of the world’s oil shipments, represents another challenge to global trade that companies have to navigate.
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The disruption comes after trade flows experienced large monthly swings last year as US importers reacted to a slew of ever-changing tariff announcements from President Donald Trump.
The American oil and gas industry stands to benefit from the export of higher-priced crude. Data from the Energy Information Administration shows US exports of crude oil rose to a record recently.
The price of Brent crude, the global benchmark, has increased more than 50 per cent since the war started Feb 28.
On an inflation-adjusted basis, the merchandise trade deficit widened to US$90.8 billion in March. The trade data showed the US posted the largest petroleum surplus on record, after adjusting for prices.
On a bilateral basis, the US merchandise trade deficit with China widened for a third month. The shortfalls with Canada and Vietnam grew. The US gap with Mexico narrowed slightly. BLOOMBERG
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