This April, the US trade deficit reached its highest level in two years, as the imports set a new record. According to the Commerce Department, April’s trade deficit in terms of goods and services was around USD 47.2 billion, which is the highest recorded deficit since July 2012. It increased USD 3 billion or 6.9% from what was in March.
The median forecast of a survey led by Action Economics, reveals that the economists were expecting a trade gap of USD 40.1 billion. However, the actual statistics crossed their predictions too. The Commerce Department stated that the exports in April were around USD 193.3 billion, showing a decrease of USD 300 million as compared to the exports of March. Also, the imports increased by USD 2.7 billion and reached USD 240.6 billion.
Moreover, the imports of goods, such as foreign cars, food and related products, increased to around USD 198.7 billion. However, the imports of industrial materials and supplies fell. April’s trade deficit of USD 14 billion with the European Union, and the trade gap of USD 7 billion with Germany, were also the highest till date. In addition, the South Korean imorts also marked a record high.
In some other economic news: In May, the service firms grew at a reasonable pace. According to the Institute for Supply Management, its service sector index increased to 56.3 last month, which was 55.2 earlier in April. Any value above 50 shows expansion. A sharp increase in productivity was observed. According to the government, productivity decreased by 3.2% in Q1. Moreover, ADP reported that businesses added around 179,000 jobs last month.