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WASHINGTON: The US trade deficit widened in November to a 10-month high on surging imports, the government said Tuesday as rising trade suggested the global economic recovery was on track.
The goods and services deficit for the penultimate month in 2009 jumped to US$36.4 billion from a revised US$33.2 billion in October, as imports grew faster than exports, the Commerce Department said in a report.
The deficit, surpassing the US$34.68 billion forecast by most economists, reached its highest level since January 2009.
Trade volume, a key indicator of economic growth, has been on the rise since late last spring with both exports and imports having returned to their levels from the beginning of 2009.
In November, US imports rose 2.6 per cent to US$174.6 billion, the highest level since December 2008, compared with exports which were up 0.9 per cent to US$138.2 billion, the highest since November 2008.
Total US trade with the rest of the world showed an increase - by 1.8 per cent - for the third consecutive month.
"The big news is continued and sustained growth in trade volume, signaling recovery both in the US and among major US trading partners, said Christopher Cornell, an economist at Moody's Economy.com.
But he cautioned that recovery was still in its early stages as exports would have to grow another 19 per cent and imports another 31 per cent before they return to their July 2008 peak.
The United States posted its first growth - 2.2 per cent - in the third quarter of last year after a year of contractions stemming from a financial crisis fueled by an American home mortgage meltdown.
In an indication that US consumers are slowing opening up their wallets, the November trade figures showed consumer goods imports were up for the third consecutive month.
"The improvement in US consumption continues to influence the trade balance of the country," noted economist Inna Mufteeva from Natixis.
But some analysts said the rising imports were not sustainable, especially as consumer sentiment remained weak amid high unemployment despite a growing economy.
"Core imports are still rebounding from their massively depressed post-Lehman level, and auto inventory building has helped too, but they cannot keep rising at this pace when domestic final demand is still so weak," said Ian Shepherdson, chief US economist for High Frequency Economics.
The collapse of top US investment bank Lehman brothers in September 2008 was part of peak of the US financial crisis that slammed the brakes on growth in most of the world.
According to the government trade figures, the deficit widening was mostly attributed to trade with European countries as well as with the OPEC oil cartel members and Africa.
Some two-thirds of the deficit increase was due to the rise in oil prices.
The politically sensitive goods deficit with China narrowed 10.8 per cent to US$20.2 billion in November from US$22.7 billion in October.
The deficit with Canada, the largest US trading partner, narrowed 32.1 per cent to US$1.4 billion while the deficit with Mexico, the second largest export destination, widened 12.8 per cent to US$5.1 billion.
- AFP/yb
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