US trade gap widens as imports rise to highest in a year

[WASHINGTON] The US merchandise-trade deficit widened in October as imports reached the highest in more than a year, outpacing a gain in the value of exports.

The shortfall grew to US$80.3 billion from US$79.4 billion in September, according to Commerce Department data released Wednesday. The median estimate by economists in a Bloomberg survey was for a negative balance of US$80.4 billion. Imports rose by 2.2 per cent to US$206.3 billion, the highest since September 2019, while exports increased 2.8 per cent to US$126 billion.

The data show that while outgoing President Donald Trump's push to rewrite the US relationship with the world was yielding some results before the outbreak, the goal of a narrower trade imbalance will go unrealised after Covid-19 upended supply chains and demand. Both exports and imports have improved since the crisis first hit, but inward-bound shipments are still below pre-pandemic levels.

The report Wednesday also showed retail inventories climbed 0.8 per cent from September, a fourth straight month of gains. Wholesale inventories advanced by 0.9 per cent.

American retailers, who remain reliant on imports, have been restocking inventories depleted by the pandemic ahead of the holiday shopping season.

BLOOMBERG

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