Trade Deficit in the United States surges 22% and tops $100 Billion for the First Time Ever
To some, this is just another number but this number is a reflection of the big appetite for foreign goods shared amongst Americans...
In March, the United States trade deficit leaped 22% and topped $100 Billion for the first time ever. To some, this is just another number but this number is a reflection of the big appetite for foreign goods shared amongst Americans. The trade gap also rose to $109.8 Billion from $89.8 Billion in February. Imports also leaped 10.3% to a record $351.5 Billion while high inflation has also added to those costs which impacted imports. While imports were up, exports also hit a record by rising 5.6% to $241.7 Billion.
During the pandemic, the United States has set record trade deficits repeatedly. Americans are able to afford more imports because the United States has recovered from the pandemic at a pace faster than other countries. Deficits subtract from GDP and the American GDP shrinked 1.4% in Q1 due to this.
Last fall, United State’s imports topped $300 Billion and now have exceeded that for five months in a row. In March alone, the U.S. has imported more oil, automotive, and consumer goods. The increase also reflects American ports are unloading record backlog of cargo ships which were once waiting offshore.
“The prevailing domestic and overseas economic environment could keep the deficit pinned near record levels and impose a significant headwind to U.S. GDP growth.”
Said Mahir Rasheed of Oxford Economics.