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Trade deficit low { June 20 2002 } Original Source Link: (May no longer be active)
http://www.washingtonpost.com/wp-dyn/articles/A16792-2002Jun20.htmlhttp://www.washingtonpost.com/wp-dyn/articles/A16792-2002Jun20.html
Trade Deficit Hits Record $35.9B
By Jeannine Aversa
Associated Press Writer
Thursday, June 20, 2002; 10:30 AM
WASHINGTON –– The United States trade deficit swelled to a record $35.9 billion in April as Americans' appetite for foreign-made cars and consumer goods, such as TVs and clothes, hit monthly all-time highs.
The Commerce Department reported Thursday that the deficit was 10.7 percent higher than the $32.5 billion trade gap reported for March.
The sizable increase left the trade imbalance in April bigger than the $33 billion deficit many analysts were forecasting.
Imports of goods and services rose 4.7 percent in April to $116 billion as cheaper-priced imports and the U.S. economic recovery helped to boost consumer demand.
Exports rose about half as fast, increasing by 2.2 percent to $80.1 billion. Countries around the globe are regaining strength after a worldwide slump less quickly than the United States, thus restraining their demand for exports.
In another report, the number of Americans filing new claims for unemployment insurance last week dipped by 2,000 to 393,000, the Labor Department said. Economists say that's an encouraging sign for workers dealing with a sluggish jobs market.
But that didn't do much for Wall Street investors. The Dow Jones industrial average was off 9 points and the Nasdaq index was down 3 during the first hour of trading.
The latest snapshot of trade activity comes as the Bush administration continues to press Congress to pass legislation that would give President Bush greater authority to negotiate new international trade agreements.
The House passed a "fast track" or "trade promotion authority" measure by just one vote in December. The Senate approved a larger package last month that included an expansion of benefits to American workers hurt by free trade. The next hurdle: reconciling the two versions.
Many conservative Republicans were not happy over the worker benefit provisions added to the Senate bill. Labor and environmental group and many Democrats are leery of the effects of free trade agreements.
In April, imported cars, parts and engines climbed to a record $16.8 billion, a 5 percent increase over March's level. Imported consumer goods, including TV, VCRs, toys and clothes, also reached a record of $24.9 billion in April, as did imports of foods, feeds and beverages, which rose to $4.1 billion.
A sharp rise in America's foreign oil bill, also contributed the trade gap in April. The average price of imported crude oil rose by $3.30 a barrel, the biggest one-month jump in nearly 12 years.
On the export side, sales of U.S.-made automobiles, parts and engines to other countries rose to $6.7 billion in April, the highest level since August 2000.
Exports of consumer goods, capital supplies, including semiconductors, and industrial supplies, such as chemicals, all showed improvements in April.
Going forward, a weaker U.S. dollar and healing economies abroad should help bolster U.S. exports, analysts say.
The U.S. dollar, which has been high-flying for years, has recently lost some altitude. A strong dollar has benefited U.S. consumers because it makes the imported cars, TV sets and other goods that they crave cheaper. But U.S. manufacturers say they have been hobbled by the dollar's strength because it makes their goods more expensive for foreigners to buy.
Separately, the "current account" deficit, which is considered to be the broadest measure of trade, climbed to a record $112.5 billion in the first quarter of this year, the Commerce Department said in another report.
The current account is broadest measure of trade because it includes not just the goods and services reflected in the government's monthly trade reports, but also investment flows between countries and unilateral transfers, including U.S. foreign aid payments.
In the monthly trade report, the America's trade deficit with Japan mushroomed by 19.1 percent in April to $6.8 billion. U.S. exports to that country dipped to $3.9 billion, the lowest level since February.
The U.S. deficit with China rose to $7.6 billion in April as imports grew to $1.9 billion, the highest level since October 2001.
© 2002 The Associated Press
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