WASHINGTON (Reuters) – The U.S. trade deficit recorded its biggest increase in more than 1-1/2 years in June as the boost to exports from soybean shipments faded and higher oil prices lifted the import bill.
The Commerce Department said on Friday the trade gap surged 7.3 percent to $46.3 billion. The rise in percentage terms was the biggest since November 2016. Data for May was revised slightly to show the trade deficit falling to $43.2 billion, instead of the previously reported $43.1 billion.
Economists polled by Reuters had forecast the trade deficit widening to $46.5 billion in June. The trade gap narrowed in April and May as farmers front-loaded soybean exports to China before Beijing’s retaliatory tariffs came into effect in early July. The United States slapped duties on $34 billion worth of Chinese goods, provoking a similar response from China.
When adjusted for inflation, the trade gap increased to $79.3 billion in June from $75.5 billion in May. The government reported last Friday that trade contributed 1.06 percentage points to the economy’s 4.1 percent annualized growth pace in the second quarter.
The politically sensitive goods trade deficit with China rose 0.9 percent to $33.5 billion in June.
In June, exports of goods and services fell 0.7 percent to $213.8 billion. Consumer goods exports decreased $1.4 billion, driven by a $0.6 billion drop in shipments of pharmaceutical preparations. There were also decreases in exports of capital goods and motor vehicles and parts.
Petroleum exports, however, rose to a record high in June.
Imports of goods and services rose 0.6 percent to $260.2 billion in June. They were boosted by imports of consumer goods and crude oil. Petroleum imports in June were the highest since December 2014. The surge reflected higher oil prices.
The price of imported crude oil averaged $62.42 per barrel in June, which was the highest level since December 2014. There were decreases in imports of computers and telecommunications equipment.
(Corrects 2nd paragraph to show rise in percentage terms instead of drop)
Reporting by Lucia Mutikani Editing by Paul Simao
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