U.S. Trade Deficit Increases as Exports Fall

On October 9, 2015, in Economics, Trade Deficit, by Maggie Ernst

The U.S. trade deficit jumped in August as exports fell to their lowest levels in almost three years. Meanwhile, imports increased, led by a surge of shipment of cellphones from China.  The deficit grew 15.6 percent to $48.3 billion, the biggest deficit since March, according to a report from the U.S. Commerce Department this week.

Exports of goods and services dropped 2 percent to $185.1 billion, the lowest level since October 2012.  Meanwhile, imports rose 1.2 percent to $233.4 billion.  The rising value of the U.S. dollar has hurt exports by making U.S. goods less competitive on overseas markets.

Meanwhile, China, the world’s second-largest economy, is experiencing weaker economic growth and many emerging market economies are being battered by a plunge in commodity prices.  Canada, the United States largest trading partner, is suffering through a recession.

So far this year, the trade deficit is at an annual rate of $531.6 billion, 4.6 percent higher than last year’s deficit of $508.3 billion.

 

 

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