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.

REUTERS