Thursday, December 18th2.3°C
24563
23931

US trade deficit up in December to $38.7 billion, but annual deficit fell to lowest in 4 years

WASHINGTON - The U.S. trade deficit widened in December after hitting a four-year low in November. But for 2013, the gap reached its lowest point since 2009 as exports rose to a record.

Analysts said the larger-than-expected trade deficit for December would likely reduce estimates of growth in the October-December quarter. The government had initially estimated fourth-quarter growth at a 3.2 per cent annual rate. But economists at Barclays say the bigger December gap could reduce that estimate to a 2.8 per cent rate.

The trade deficit rose to $38.7 billion in December, a 12 per cent increase over November, the Commerce Department said Thursday. Exports slipped 1.8 per cent to $191.3 billion. Imports rose 0.3 per cent to $230 billion.

For all of 2013, the deficit dropped 11.8 per cent to $471.5 billion. That was the lowest level since the Great Recession caused the deficit to shrink in 2009.

U.S. exports rose 2.8 per cent as an improving global economy benefited American manufacturers. An energy production boom also lifted U.S. petroleum exports to a record. Imports dipped 0.1 per cent.

A smaller trade deficit can boost economic growth. U.S. manufacturers gain from rising export sales while U.S. consumers are buying fewer foreign-made products.

A domestic energy boom has boosted exports and reduced America's dependence on foreign oil. U.S. petroleum exports were up 10.9 per cent in 2013 to an all-time high of $137 billion. Imports were down 11 per cent to $369.3 billion. The drop in imports was helped by falling global oil prices.

By country, the United States ran another record trade deficit with China: $318.4 billion for the year, an increase of 1 per cent from 2012. The United States has recorded its largest trade deficit with China each year since 2000, when that country supplanted Japan as the nation with the largest trade imbalance with the United States.

That is likely to add to pressure on Congress and the Obama administration to crack down on what critics see as China's unfair trade practices. U.S. manufacturers contend that China is keeping its currency undervalued against the dollar by as much as 40 per cent in order to gain trade advantages. A weaker Chinese currency makes Chinese goods cheaper for U.S. consumers and American products more expensive in China.

The U.S. deficit with the 28-nation European Union rose 8 per cent to a record $125.1 billion in 2013.

Many analysts say 2014 may be the year that the economy finally ramps up to stronger growth of around 3 per cent. In 2013, the economy grew at a sub-par 1.9 per cent rate.

The hope is that an improving global economy will lift U.S. exports. But there have been worries recently stemming from plunging currency values in a number of emerging market economies. Investors have grown worried about what impact the Federal Reserve's decision to lower its support for the U.S. economy might have on emerging market nations.

The Canadian Press


Read more Business News




Recent Trending




Today's Market
S&P TSX14346.75+133.36
S&P CDNX665.50+6.47
DJIA17778.15421.28
Nasdaq4748.396+104.085
S&P 5002061.23+48.34
CDN Dollar0.8637+0.0004
Gold1198.50+3.80
Oil54.91+0.80
Lumber336.00-0.90
Natural Gas3.663+0.021

 
Okanagan Companies
Pacific Safety0.13+0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.28+0.01
Cantex0.03-0.005
Anavex Life Sciences0.17+0.0041
Metalex Ventures0.055+0.005
Russel Metals26.00-1.18
Copper Mountain Mining1.57+0.03
Colorado Resources0.12+0.015
ReliaBrand Inc0.011-0.0089
Sunrise Resources Ltd0.055+0.005
Mission Ready Services0.225+0.005

 
24130


21297

FEATURED Property
2122382213-2377 Shannon Woods Drive
2 bedrooms 2 baths
$359,900
more details
image2image2image2
Click here to feature your property
Please wait... loading


Parenthood: Estates, insurance & taxes

It is now even more important to ensure your loved ones are well looked if anything should happen to you. Here are a few topics to consider helping you prepare for some of the unexpected events that c...


Managing your sales team

Managing a sales team can be quite a challenge. Harnessing individual personality preferences and getting everyone focused on the same goals, moving at the same pace, and working in collaboration to d...


Working under the table

They say there are only two things that are certain in life: death and taxes. Not exactly an uplifting thought, but true nonetheless. Some people try to avoid paying tax by “working under the ta...

_





24111


Member of BC Press Council


23871