WASHINGTON: The US trade deficit unexpectedly widened in September as exports hit a five-month low, suggesting slowing global demand could undercut economic growth in the final three months of the year.
The Commerce Department said yesterday the trade gap increased 7.6 percent to $43.03bn. Economists had forecast the shortfall at $40bn in September.
“The disappointing performance in export activity suggests that the loss of export competitiveness from the strong dollar and the weak global backdrop are becoming a net drag on US economic activity,” said Millan Mulraine, deputy chief economist at TD Securities in New York.
The trade deficit was bigger than the $38.1bn gap that the government had assumed in its advance gross domestic product estimate for the third quarter published last week.
The weak trade data came on the heels of a report on Monday showing a decline in construction spending in September.
Economists said the two reports combined suggested that the third-quarter 3.5 percent annual growth pace could be cut by as much as half a percentage point when the government publishes its revisions later this month. Trade was reported to have contributed 1.32 percentage points to GDP growth.
Exports in September fell 1.5 percent to $195.59bn, the lowest since April, a sign that weakening demand in key markets such as China and the euro zone was starting to weigh. Exports are likely to weaken further after a survey of US manufacturers published on Monday showed a decline in a gauge of export order growth. Reuters
