US trade deficit rises despite record American exports

WASHINGTON: The US trade deficit widened in February for the sixth straight month, hitting a fresh nine-year record even though US exports were at an all-time high, official data showed Thursday.

The broadening gap comes as President Donald Trump pursues an increasingly fraught battle with the world's largest economies to right the yawning US trade imbalance, sparking fears of a trade war.

Soaring US imports of industrial supplies and capital goods pushed the monthly US trade deficit up 1.6 percent to $57.6 billion, seasonally adjusted, the highest level since October 2008.

The result overshot the expectations of economists, who were calling for the trade deficit to hold steady at January's level, previously the highest since October 2008.

The rising trade gap also pointed to weaker growth in the first quarter as deficits subtract from calculations of GDP.

Tit-for-tat exchanges of tariff threats from Washington and Beijing this week have whipsawed global stock markets, prompting the Trump administration to call for calm and point to negotiations as a likely course of action.

Washington and Beijing have threatened in recent days to put import duties on about $50 billion of each other's exports -- with the Chinese targeting politically sensitive US goods such as soybeans and the Americans pointing to high-end manufactured items in the aerospace, auto, pharmaceutical and other sectors.

But February's figures showed the US bilateral deficit in goods trade with China -- America's largest and the focus of much of Trump's ire -- fell nearly 19 percent in February to $29.3 billion.

Overall, February exports of US goods and services rose 1.7 percent to their highest on record at $204.4 billion.

But so did imports, which likewise gained 1.7 percent to reach $262 billion -- also an all-time record.

Elsewhere, the February numbers were replete with more records: US exports of autos, parts and engines were the highest on record at $14.8 billion for the month.

But the US goods deficit was still at its highest level since July 2008 at $76 billion -- with capital goods imports at an all-time high of $57.8 billion.