The United States’ deficit in goods and services trade expanded 9.4 percent in July following a 7.5 percent increase the previous month.
The U.S. trade deficit expanded for the second consecutive month in July following a three-month decline that brought the deficit to its lowest level since October 2016.
The deficit in goods and services trade climbed 9.4 percent to $50.1 billion for the month, the largest since February, as export volumes declined and imports increased, according to the most recent data from the U.S. Department of Commerce’s Bureau of Economic Analysis.
The July figures followed a revised 7.5 percent increase the previous month and declines in May, April and March that were themselves preceded by six straight months of growth.
U.S. exports slipped 1 percent in July to reach $211.1 billion, while the nation’s imports ticked up 0.8 percent to $261.2 billion.
Prior to the June revision, which pegged the trade deficit at $45.7 billion rather than $46.3 billion as previously reported, economists polled by Reuters had projected the trade deficit to expand to $50.3 billion in July.
Through the first seven months of 2018, the U.S. trade deficit has grown 7 percent to $337.9 billion, with exports rising 8.6 percent and imports growing 8.3 percent compared with the first half of 2017.
The three-month moving average of the goods and services deficit grew 3.4 percent to $46.1 billion for the three months ending in July, with average exports increasing less than 0.1 percent to $213 billion and average imports up 0.7 percent to $259.1 billion, according to BEA.
And on a year-over-year basis, the three-month average goods and services deficit is now up 2.7 percent from the same 2017 period, as exports and imports have increased $18.7 billion (9.6 percent) and $19.9 billion (8.3 percent), respectively.
President Donald Trump has made the trade deficit a key focus of his administration’s international trade policy, vowing to drastically reduce or even eliminate it entirely as one of several goals in imposing widespread tariffs on imports of foreign-made goods despite many analysts and economists questioning whether this is a goal that’s even worth pursuing in the first place.
The latest figures from BEA were released just one day before the end of a public comment period on the latest list of Chinese exports worth roughly $200 billion annually targeted for additional U.S. tariffs. In addition to broad global tariffs on solar panels, washing machines, steel and aluminum imposed earlier this year, the Trump administration already has increased tariffs on $50 billion in imports from China, prompting Beijing to retaliate in kind.
Gao Feng, a spokesperson for China’s Ministry of Commerce, reportedly said in a press conference Wednesday, “If the United States, regardless of opposition, adopts any new tariff measures, China will be forced to roll out necessary retaliatory measures.”
Trump told reporters Wednesday trade negotiations with Beijing would continue, but that the United States was not yet satisfied with the terms offered by China.
“We’ve done very well in negotiations with China, but we’re not prepared to make the deal that they’d like to make,” he said at a White House press briefing. “We’ll continue to talk to China. I have great respect for President Xi, but right now we just can’t make that deal.”
The Trump administration has railed against alleged unfair trade practices, currency manipulation and intellectual property violations on the part of China, while Beijing has accused the president of “protectionist bullying.”
According to BEA, the U.S. bilateral trade deficit with China grew another 5.2 percent to $34.1 billion in July compared with the previous month, even as Trump and negotiators continued efforts to come to an agreement with Beijing that would likely seek to reduce the imbalance.
Trade deficit rises for second straight month
