US trade deficit hits new record in January as exports fall

[WASHINGTON] A jump in oil and auto imports in January combined with a sharp drop in exports caused the US trade gap to widen again in January, according to official data released Tuesday.

The trade deficit in the world's largest economy increased by 9.4 per cent compared with December to a record US$89.7 billion, the Commerce Department reported.

Exports fell 1.7 per cent to US$224.4 billion while imports rose to US$314.1 billion, the report said.

US firms have been trying to replenish depleted inventories and bring in parts and materials that have proved hard to find due to the pandemic disruptions that have snarled global supply chains.

"Overall, trade flows are at historic highs," Rubeela Farooqi, of High Frequency Economics said in an analysis, but the "deficit is poised to remain elevated for now on ongoing strong demand for imports." Exports of services like travel fell, while the deficit in goods trade also hit a record, according to the data.

Imports of autos, parts and engines jumped US$1.6 billion, while purchases of crude oil and natural gas rose US$1.5 billion, but key semiconductors, needed for everything from cars to cell phones, fell US$600 million compared to December. AFP