- The U.S. trade deficit grew for the first time in three months to hit $61.5 billion in September.
- The 4.9% increase in the trade deficit was higher than the $59.8 billion that analysts had forecast.
- While the trade imbalance with China reached its highest levels in a year, U.S. exports also grew, with capital goods shipments reaching their highest-ever levels.
The U.S. trade deficit increased on a monthly basis for the first time in three months, as the trade imbalance with China grew despite the U.S. raising exports of capital goods to their highest-ever level.
The U.S. Bureau of Economic Analysis reported that the trade deficit reached $61.5 billion in September, a 4.9% increase from August’s trade deficit of $58.7 billion. Analysts forecast a trade deficit of $59.8 billion.
Exports of goods and services were at their highest level since August 2022, with exports of capital goods—assets like buildings and equipment that businesses use to deliver products and services— reaching $51.1 billion, its highest-ever level.
Overall, imports of goods increased by 2.7% to reach $322.7 billion, while goods exports from the U.S. increased by $5.7 billion, or about 2.2%, as September’s exports totaled $261.1 billion.
“While we expect exports and imports to weaken in the months ahead, imports will likely fare worse as consumer spending slows and businesses work down their inventory levels,” wrote Matthew Martin, U.S. economist at Oxford Economics.
Trade Imbalance with China Grows, Narrows in Europe
Over the nine months recorded so far in 2023, the U.S. trade deficit has narrowed by 20% compared with the same period a year earlier, as exports have moved slightly higher and the value of imports has lowered significantly, according to Mark Hopkins of Moody’s Analytics.
The trade deficit with China hit $28.4 billion, its highest level since October 2022, and a jump from the $22.7 billion August trade deficit with the world’s second-largest economy. Imports from China reached $40.3 billion, the highest level since October 2022.
Elsewhere, the trade deficit with Germany fell to $5.8 billion in September, the lowest reading in more than a year, while the trade deficit with Italy was its lowest point since May 2020 as exports to the country reached a record $3.2 billion.
Crude oil imports increased by $1.4 billion in September, slightly lower than the prior month’s crude oil imports of $1.5 billion. Crude oil exports increased $0.4 billion.