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US trade gap widens as exports plummet
By Glenn Somerville |
June 11, 2009, Thursday
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Print Edition
Print Edition
THE trade gap in the United States widened to US$29.2 billion in April as exports weakened again amid waning global demand, a US government report showed yesterday.
The Commerce Department said total exports fell 2.3 percent to US$121.1 billion, the lowest level for foreign sales since mid-2006. Exports have dropped in eight of the past nine months as the world economy struggled through a financial crisis that has sapped consumers' ability and willingness to spend.
The April deficit was in line with Wall Street forecasts.
Imports declined in April for a ninth straight month but by a smaller amount than exports, down 1.4 percent to US$150.3 billion. That was the lowest value for imports since September 2004, more evidence that the recession-struck US economy was not generating as much demand as it once did.
Analysts said US reliance on China as its chief supplier was growing and hopes that stronger trade could replace consumer demand as a driver for US growth were fading because the whole world was in a slowdown.
"We are not going to get a big boost from trade," said David Wyss, chief economist fro Standard and Poor's Ratings Services in New York. "We are losing the one good tailwind that we have had."
Wyss said US gross domestic product, the broadest measure of overall economic growth, was likely to contract at a 2.8 percent annual rate in the second quarter after shrinking 5.7 percent in the first three months of this year.
The dollar slipped against a range of currencies, while US Treasury yields rose yesterday after Russia's central bank said it will cut the share of its currency reserves invested in US Treasuries and buy bonds issued by the International Monetary Fund.
The Commerce Department said total exports fell 2.3 percent to US$121.1 billion, the lowest level for foreign sales since mid-2006. Exports have dropped in eight of the past nine months as the world economy struggled through a financial crisis that has sapped consumers' ability and willingness to spend.
The April deficit was in line with Wall Street forecasts.
Imports declined in April for a ninth straight month but by a smaller amount than exports, down 1.4 percent to US$150.3 billion. That was the lowest value for imports since September 2004, more evidence that the recession-struck US economy was not generating as much demand as it once did.
Analysts said US reliance on China as its chief supplier was growing and hopes that stronger trade could replace consumer demand as a driver for US growth were fading because the whole world was in a slowdown.
"We are not going to get a big boost from trade," said David Wyss, chief economist fro Standard and Poor's Ratings Services in New York. "We are losing the one good tailwind that we have had."
Wyss said US gross domestic product, the broadest measure of overall economic growth, was likely to contract at a 2.8 percent annual rate in the second quarter after shrinking 5.7 percent in the first three months of this year.
The dollar slipped against a range of currencies, while US Treasury yields rose yesterday after Russia's central bank said it will cut the share of its currency reserves invested in US Treasuries and buy bonds issued by the International Monetary Fund.
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