Thursday, July 2nd17.5°C
25936
26754

US trade gap falls to $34.3 billion in November, a 4-year low, as exports hit record high

WASHINGTON - The U.S. trade deficit fell in November to its lowest level in four years, an encouraging sign that economic growth in the final three months of the year was stronger than analysts had forecast.

Gains in energy production and stronger sales of American-made airplanes, autos and machinery lifted exports to an all-time high.

The trade gap dropped 12.9 per cent in November to $34.3 billion, the Commerce Department said Tuesday. That's the lowest monthly trade deficit since October 2009.

Exports rose 0.9 per cent to a record $194.9 billion. The gain was aided by a 5.6 per cent rise in petroleum exports.

Imports dropped 1.4 per cent to $229.1 billion. A decrease in demand for foreign oil offset a record level of imported autos.

A smaller trade deficit can boost economic growth. It typically shows that American companies are earning more from sales overseas, while U.S. consumers are buying fewer products from foreign companies.

Economists raised their growth forecasts for the October-December quarter after seeing the November trade report.

Jennifer Lee, senior economist at BMO Capital Markets, noted that the trade gap declined in both October and November. She is currently forecasting growth at an annual rate of 2.4 per cent. But after the trade report she said growth could end up being stronger.

Paul Ashworth, chief U.S. economist at Capital Economics, said growth could be 3 per cent or higher.

Through 11 months of 2013, the trade deficit is 12.3 per cent lower than the same period in 2012. Exports have strengthened, while imports are slightly lower.

A domestic energy boom has boosted exports and lessened America's dependence on foreign oil. U.S. petroleum exports were up 10.8 per cent through the first 11 months of 2013 compared with the same period in 2012. In that same period, petroleum imports have fallen 11.5 per cent.

The drop in oil imports has been helped by lower global prices. After peaking at $102 per barrel in September, the average price of a barrel of imported crude oil has fallen and averaged $94.69 a barrel in November. Analysts are predicting the price of imported oil will decline further, noting ample supplies and a strengthening dollar

The U.S. deficit with China fell 6.7 per cent in November from October to $26.9 billion. U.S. exports to China hit a record. The U.S. deficit with China, the largest with any country, is still on track to set another record this year.

The deficit with the European Union dropped 29.4 per cent in November to $10.1 billion. That reflected a big drop in imports from that region, which offset a small dip in U.S. sales to Europe.

The overall economy grew at an annual rate of 4.1 per cent in the July-September quarter. Much of that strength reflected a buildup in business stockpiles. Economists believe inventory building slowed in the October-December quarter, which could dampen growth.

Still, other data have been encouraging. The rise in exports has lifted factory output. And a stronger job market has made Americans more confident in the economy and led to more spending. Those factors could offset some of the drag from lower inventory growth.

The Canadian Press


Read more Business News




Recent Trending




Today's Market
S&P TSX14553.33+63.18
S&P CDNX671.49+4.40
DJIA17757.91+138.40
Nasdaq5013.12+26.26
S&P 5002077.42+14.31
CDN Dollar0.7933-0.0012
Gold1163.00-6.00
Oil57.88+0.18
Lumber288.90+0.60
Natural Gas2.81+0.03

 
Okanagan Companies
Pacific Safety0.16-0.01
Knighthawk0.010.00
QHR Technologies Inc1.52-0.01
Cantex0.04-0.01
Anavex Life Sciences0.451+0.001
Metalex Ventures0.075+0.010
Russel Metals22.73+0.05
Copper Mountain Mining1.16-0.01
Colorado Resources0.08-0.02
ReliaBrand Inc0.006-0.000
Sunrise Resources Ltd0.04+0.01
Mission Ready Services0.185+0.015
Decisive Dividend Corporation2.50+0.42

 





FEATURED Property
23256401161 Lynden Road
6 bedrooms 3 baths
$529,900
more details
image2image2image2
Click here to feature your property
Please wait... loading


Active listening

Has this ever happened to you? You had an initial meeting with a prospect. You asked that prospect what seemed to be all the right questions. You had what felt to you like a good conversation, and bas...


The price of money

Money is not a commodity. By definition, a commodity is a generic product that is bought and sold on price alone. Money, Canadian bills for example, look the same, smell somewhat the same, and are ava...


TFSA strategies

Photo: Thinkstock.comThe federal government has increased the annual contribution limit of Tax-Free Savings Accounts (TFSA) to $10,000. Going forward, the annual limit will no longer be indexed to inf...

_





26376


Member of BC Press Council


26708