Trade deficit narrows to $1.5 billion in October


Boosted by a weaker United States dollar, the October trade gap rose 8.6 per cent compared to September, to US$48.7 billion, the highest since January, surpassing analyst expectations for an increase of only 5.6 per cent.

Imports hit a record $244.6 billion in October on growing US demand amid an improving economy, while exports were unchanged at $195.9 billion from September.

U.S. imports of goods and services rose to the highest on record in October, widening the trade gap to its highest level in nine months, according to government data released on Tuesday (Dec 5).

Total U.S. exports were $195.9 billion in October, down by less than $0.1 billion from September. Increased imports of consumer goods, including cellphones, also contributed to the month's rise.

To be sure, the export categories that dropped in October are typically volatile and prone to large swings from month to month, so soybeans or civilian aircraft exports could pick up again in 2017's remaining two months.

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Other highlights in overall global trade of the US last month include the highest imports on record from China, from Mexico, and from the European Union.

The U.S. trade deficit with Canada increased from $300 million in September to $1.8 billion in October, with U.S. imports rising $1.4 billion-primarily crude oil-to $25.8 billion. In the first 10 months of 2017, the value of US imports rose 6.5% and exports increased 5.3% compared with the first 10 months of 2016.

Exports to China, meanwhile, were the highest in nearly four years, at US$13 billion. USA exports to China increased $2.2 billion to $13.0 billion, primarily driven by soybeans and crude oil.

The U.S. Chamber of Commerce said in a May report that they disagree "with the contention that the goods trade deficit is an appropriate gauge of whether a particular set of trade policies - or trade agreements - is delivering benefits to the American people more broadly".

Historically speaking, the USA imports more good than it exports, but runs a modest trade surplus for services.