In a report released on Tuesday, the Commerce Department indicated that the U.S. trade deficit expanded in November, aligning closely with economists' projections. This occurred as imports exhibited a more significant rebound compared to exports.
Specifically, the trade deficit increased to $78.2 billion in November, up from a revised figure of $73.6 billion in October. Initially, economists had predicted the deficit to ascend to $78.0 billion, compared to the previously reported $73.8 billion for October.
Matthew Martin, Senior U.S. Economist at Oxford Economics, commented, "As anticipated, both import and export trade flows picked up from October's decline, though the more substantial rise in imports contributed to a broader trade deficit in November." He further explained, "Net trade is poised to be marginally positive or neutral concerning GDP growth in the fourth quarter, a first since the fourth quarter of 2023. Nonetheless, uncertainties remain, including the looming potential of another dockworkers' strike in mid-January."
The expansion in the trade deficit was driven by a 3.4 percent increase in the value of imports, reaching $351.6 billion in November, following a 3.9 percent drop to $339.9 billion in October. This resurgence was partly attributed to significant hikes in imports of industrial supplies, materials, and capital goods.
Concurrently, the value of exports grew by 2.7 percent to $273.4 billion in November after a 1.4 percent decline to $266.3 billion in October. The export surge was fueled by increased shipments of industrial supplies and materials, along with automotive vehicles, parts, engines, capital goods, and consumer goods.
Additionally, the Commerce Department reported that the goods deficit expanded to $103.4 billion in November from $97.9 billion in October, while the services surplus increased to $25.2 billion from $24.3 billion.
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