3 Min Read
WASHINGTON, Jan 6 (Reuters) - - The U.S. trade deficit widened for a second straight month in November as imports rose to their highest level in more than a year on higher oil prices, suggesting that trade was a significant drag on economic growth in the fourth quarter.
The Commerce Department said on Friday the trade gap increased 6.8 percent to $45.2 billion. October's trade deficit was revised down slightly to $42.4 billion from the previously reported $42.6 billion.
Economists polled by Reuters had forecast the trade gap little changed at $42.5 billion in November. When adjusted for inflation, the deficit increased to $63.6 billion from $60.3 billion in October.
Trade contributed 0.85 percentage point to the third quarter's 3.5 percent annualized rate of increase in gross domestic product. Economists expect trade will slice off more than one percentage point from GDP growth in the fourth quarter.
Despite the drag from trade, growth in the fourth quarter is expected to have been supported by consumer spending, a firming housing market and rising gas and oil well drilling. The Atlanta Federal Reserve is currently forecasting GDP rising at a 2.9 percent rate in the fourth quarter.
Imports of goods and services increased 1.1 percent to $231.1 billion in November, the highest level since August 2015. Part of the increase in the import bill reflects higher oil prices.
Inflation-adjusted petroleum imports were the highest since November 2012.
There were also increases in imports of industrial supplies and materials, which rose to their highest level since July 2015.
Imports of goods from China fell 2.7 percent in November.
Exports slipped 0.2 percent to $185.8 billion in November, hurt by shipments of capital goods, which fell to their lowest level since September 2011. Exports remain constrained by relentless dollar strength. There were, however, increases in exports of industrial supplies and materials, which hit their highest level since July 2015. Petroleum exports were also the highest since July 2015.
The politically sensitive U.S.-China trade deficit fell 2.0 percent to $30.5 billion in November.
Reporting by Lucia Mutikani; Editing by Andrea Ricci