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The US trade gap widened in November for the first time since June, hitting its highest level in five months due to companies increasing imports of crude oil and cars.
The US trade deficit widened in November for the first time since June, hitting its highest level in five months due to demand for more expensive foreign oil, industrial supplies and cars.
Official figures from the Commerce Department in Washington on Friday showed that the trade gap grew from $43.3 billion in October to $47.8 billion in November, an increase of 10.4 percent and higher than the $45 billion expected by economists, the Financial Times reported.
According to the BBC, imports rose 1.3 percent to a record $225.6 billion while exports dropped for the second month in a row, falling 0.9 percent to $177.8 billion due to lower demand for cars and capital goods like machinery and aircraft, reflecting the recent cooling in the global economy.
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November saw the biggest increase in imports since May, according to Reuters. The average price for imported oil climbed to $102.50 per barrel, up 3.7% from the previous month.
The Commerce Department’s report suggested a modest improvement in the politically sensitive trade deficit with China however, with rising US exports (up to $9.9 billion) and falling imports narrowing the imbalance to $26.9 billion in November – the highest since December 2010, the Financial Times reported.
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Bloomberg quoted a senior US economist at BNP Paribas in New York, Jeremy Lawson, as stating that “domestic demand is a bit stronger than external demand as global growth weakens… the question is whether US consumption can be maintained in the first part of the year post-Christmas.”