US trade deficit on goods rises slightly more than expected in October
America's shortfall on trade in goods with the rest of the world widened last month as export growth slipped.
The US deficit on its foreign trade in goods increased by 1.3% month-on-month in October to reach -$77.2bn, according to the Department of Commerce.
Exports shrank by 0.5% versus the previous month to reach $140.5bn while imports were little changed, edging up by just $0.2bn to $217.8bn.
Economists had penciled-in a deficit of -$77.0bn.
According to Ian Shepherdson, chief economist at Pantheon Macroeconomics: "Overall, these data mean that when the full international trade data are released next week, the headline deficit will be reported at a 10-year high, and the trend is deteriorating. Tariffs can't fix the fundamental problem that the U.S. doesn't save, net, so it has to run a deficit."
"[...] Net foreign trade is set to be a drag on fourth quarter GDP growth, though the hit will be much smaller than the 1.9 percentage point drag in the third quarter."
Worth noting, Shepherdson said the data could "much worse", as data on container movements at major ports had pointed towards a bigger increase in imports.
But a 5.3% fall in purchases of capital goods from overseas had acted as an offset with lower oil prices having also helped. Exports had also disappointed, he said, albeit on the back of the "noisy" foods/feeds/beverage component and figures on weekly export inspections had in fact been pointing to a hefty rebound in soybean exports.