The deficit in goods increased by 18% to $ 122.1 billion, according to Ministry of Commerce data on Wednesday
At record levels, the deficit in the US trade balance in December was expanded in a record number as imports increased, stressing the challenges of the Trump government.
The deficit in goods increased by 18% to $ 122.1 billion, according to the Ministry of Commerce on Wednesday. The amount, which is not adapted to inflation, has exceeded all estimates in Bloomberg survey.
Imports of goods increased almost 4% to $ 289.6 billion and exports decreased by 4.5% to $ 167.5 billion.
US manufacturers are still having problems due to weak overseas and strong dollar economies, which may lead to the maintenance of the large trade divide this year. However, the increase in imports could also reflect US companies’ attempt to secure imports before possible tariff duties from the Trump government – which may begin on Saturday.
Trump wants to impose duties to stimulate investment in manufacturing and encourage domestic production, a policy that, he says, will help increase jobs in the factories and reduce the trade deficit. The latter, however, will be difficult to deal with, as companies have been trying to benefit from the lowest costs and more relaxed regulations of other countries for decades.
Economists also say that the trade deficit is largely due to macroeconomic causes such as high US consumption rates and the strong dollar that makes imports cheap and are strengthened by its nature as a reserve.
The Ministry of Commerce report showed that retail stocks fell 0.3% last month, recording the first decline in one year. Stocks of car dealers declined by 1.2%, marking the third consecutive decline after more than two years of profit. Wholesalers’ stocks decreased by 0.5%.
Source: Skai
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