Weak exports worsen US trade deficit in October by Reuters

WASHINGTON (Reuters) – The U.S. trade deficit increased more than expected in October as exports fell, making trade likely a drag on economic growth in the fourth quarter of the year.

The Commerce Ministry’s Statistics Bureau said on Wednesday that the trade deficit increased 5.1 percent to 64.3 billion. Data for September was revised to show the trade deficit rising to $61.2 billion instead of $61.5 billion in a previous reading.

Economists polled by Reuters had expected the trade deficit to rise to $64.2 billion in October.

Exports of goods and services decreased by 1 percent to $258.8 billion. Goods exports fell 1.8 percent to $173.5 billion. Consumer goods exports fell by $2.1 billion, led by diamonds and pharmaceutical products. Exports of cars, spare parts and engines decreased by $0.9 billion.

But exports of industrial supplies and materials increased by $1.2 billion. Exports of capital goods reached $51.2 billion, the highest number on record. Services exports rose $0.6 billion to $85.3 billion, supported by transportation, financial and other business services. But exports of travel services declined.

Imports of goods and services rose 0.2 percent to $323.0 billion. Imports of goods rose 0.1 percent to $263.3 billion, which could weaken domestic demand amid rising interest rates.

Imports of capital goods increased $1.8 billion amid a rise in computers, drilling and oilfield equipment. Imports of cars, spare parts and engines fell by one billion dollars.

Services imports increased $0.2 billion to $59.8 billion, supported by an increase in travel.

Trade did not affect, neither negatively nor positively, the economy’s annual growth rate of 5.2 percent in the third quarter. Growth estimates for the fourth quarter are mostly less than two percent.

(Prepared by Muhammad Harfouche for the Arabic Bulletin – Edited by Mahmoud Salama)