US Trade Deficit Widens More Than Expected To USD48.7 Billion In October

US Trade Deficit Widens More Than Expected To USD48.7 Billion In October

The foreign-trade gap in goods and services expanded 8.6% from the prior month to a seasonally adjusted $48.73 billion in October, the Commerce Department said Tuesday.

Economists had expected a deficit of $2.7 billion for October, according to Thomson Reuters. Imports, on the other hand, increased to $244.6 billion in October, up from $240.8 billion in September.

Imports of industrial supplies and materials increased $1.8 billion, reflecting a $1.5 billion increase in crude oil imports.

Exports to China, meanwhile, were the highest in nearly four years, at US$13 billion.

The report said the trade deficit widened to USD48.7 billion in October from a revised USD44.9 billion in September.

Apart from the $1.5-billion increase in crude oil imports, the higher USA import bill was due to the highest on record imports of food, feeds, and beverages, and the highest on record non-petroleum imports.

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Several powerful late-summer hurricanes may have affected trade data for recent months, though the Commerce Department said the "effects generally can not be isolated".

Average prices for imported crude oil also hit a two-year high at US$47.26 a barrel, moving the value of crude imports up by US$1.5 billion. The overall trade deficit widened 11.9% so far this year compared with the same period in 2016.

Strong U.S. consumer spending, buoyed by a tight labor market and sky-high confidence, has also helped drive the recent ramp-up in imports.

The Trump administration has focused its trade policy efforts on lowering the trade deficit, arguing that the United States has been shafted in trade deals such as the North American Free Trade Agreement.

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".

Imports of mobile phones rose US$300 million as did transportation services.