U.S. Trade Deficit Grows as Exports Fall

Washington, Rabi’II 26, 1437, Feb 5, 2016, SPA — The U.S. trade deficit increased in December as exports fell for a third consecutive month, the government reported Friday, reflecting the pressures of a stronger dollar and spreading global weakness.
The Commerce Department said the trade deficit rose 2.7 percent to $43.4 billion. Exports fell 0.3 percent, driven by declining sales of civilian aircraft, autos, and farm products, as the dollar gained 9.2 percent against other major currencies last year, eroding the appeal of U.S.-made goods overseas.
Imports increased 0.3 percent in December to Americans purchased more foreign-made cars and petroleum.
For all of 2015, the trade deficit rose 4.6 percent to $531.5 billion. Exports fell 4.8 percent, the first annual drop since 2009, amid the Great Recession. Imports fell 3.1 percent.
A wider trade deficit limits economic growth because it means fewer overseas sales by U.S. producers and larger imports of foreign goods. The deficit subtracted about 0.5 percentage point from gross domestic product (GDP) in the fourth quarter, keeping the growth rate at a weak 0.7 percent annual rate.
Trade also is expected to limit growth in 2016, with the dollar continuing to rise and China, the world’s second-biggest economy, still struggling to address slowing growth.
The politically sensitive U.S. trade deficit with China set a record in 2015, rising 6.6 percent to $365.7 billion. The deficit with the European Union also set a record, rising 7.9 percent to $153.3 billion.

–SPA
20:11 LOCAL TIME 17:11 GMT