Stacked containers and cranes at the Port of Los Angeles, on Nov. 22, 2021.MIKE BLAKE/Reuters
The U.S. trade deficit widened sharply in January amid a jump in goods imports, a trend that if it persists could see trade subtracting from economic growth this quarter.
The trade deficit increased 5.1 per cent to $67.4-billion, the Commerce Department’s Bureau of Economic Analysis said on Thursday. Data for November was revised to show the trade gap rising to $64.2-billion instead of $62.2-billion as previously reported. The trade deficit narrowed to $779.8-billion in 2023 from $951.2-billion in 2022.
It represented 2.9 per cent of gross domestic product, down from 3.7 per cent in 2022. Trade added 0.32 percentage point to the economy’s 3.2 per cent annualized growth rate in the fourth quarter after being neutral for two straight quarters. Growth estimates for the first quarter are converging around a 2.0 per cent pace.
Imports increased 1.1 per cent to $324.6-billion in January. Goods imports shot up 1.2 per cent to $263.4-billion.
Imports of capital goods as well as those of motor vehicles parts and engines were the highest on record, which bodes well for business investment on equipment. Services imports rose $0.5-billion to an all-time high of $61.3-billion.
Exports edged up 0.1 per cent to $257.2-billion. Goods exports also nudged up 0.1 per cent to $171.8-billion. Though capital goods exports were the highest on record, they were partially offset by a $1.4-billion decline in crude oil exports. Exports of services increased $0.2-billion to $85.4-billion, also a record high.