US trade gap grows to $48.7B, as imports surge

The U.S. trade deficit expanded in November to its widest point in seven months, driven by a surge in imports that outpaced only modest growth in exports.
Associated Press
Jan 13, 2013

The Commerce Department report Friday suggests trade will drag on economic growth in the October-December quarter. A wider trade gap slows growth because it means Americans spent more on foreign products while U.S. businesses earned less in overseas sales.

Still, the report showed consumers have maintained an appetite for spending. They kept buying iPhones and other imported goods in November, despite high unemployment and low wage growth.

"A strong rebound in imports is not necessarily all bad for the U.S. economy because it indicates that consumers are spending. It shows the private sector is not dead," said Gregory Daco, senior economist at HIS Global Insight.

The trade gap widened 15.8 percent to $48.7 billion in November from October, the report noted. Imports grew 3.8 percent, led by gains in shipments of cell phones, including Apple's new iPhone.

Exports increased only 1 percent. And exports to Europe fell 1.3 percent, further evidence of the prolonged debt crisis that has gripped the region.

Paul Ashworth, chief U.S. economist at Capital Economics, predicts trade trimmed growth by about 0.5 percentage point in the final three months of the year. He expects fourth-quarter growth to be no more than an annual rate of 1.5 percent. That would be nearly half the 3.1 percent rate reported for the July-September quarter, which was helped by healthy growth in exports.

Martin Schwerdtfeger, senior economist at TD Bank, also expects the trade deficit to subtract from October-December growth. But he said the flood of imports could be signaling stronger consumer spending and business investment.

"The higher imports could mean that domestic consumption is improving. That would override some of the drag from a higher trade deficit," Schwerdtfeger said.

Through the first 11 months of 2012, the trade deficit is running at an annual rate of $546.6 billion. That's roughly 2.4 percent lower than the 2011 deficit.

Imports of consumer goods grew to a monthly record in November. Much of the growth was from cell phones and other household electronics products.

Oil imports dropped 2.5 percent, reflecting a fall in prices and lower volume.

Imports of foreign-made autos and auto parts rose, likely reflecting catch-up shipments following port disruptions in October caused by Superstorm Sandy.

The U.S. trade deficit with China, the largest with any country, totaled $29 billion in November. That's down slightly from the monthly record of $29.5 billion in October. But the trade gap with China is still on track to set a new annual record in 2012.

Trade was a modest positive for overall economic growth in 2012 and many economists believe that trend will continue in 2013. However, that forecast is based on a view that the European debt crisis stabilizes and growth in Asia begins to rebound.

In its latest outlook, a forecasting panel for the National Association for Business Economics predicted that the U.S. trade deficit for 2013 will total $533 billion, a slight improvement from the $540 billion deficit they expect when the trade numbers are totaled up for all of 2012. That expectation for a slight improvement is based on a view that export growth will outpace imports in 2013.




Kimo writes:

"The computer/phone/tablet you are using to post is either all or part 'Made in China.'"

Better check your assumptions with some "inconvenient" facts.

#1. The intellectual property rights are usually owned in the U.S.

#2. If mgfing returned to the U.S., the work would be largely done by robots.

#3. Where is the iPhone built?:


Contributor 11 months ago

Swamp Fox

Its obbies economy......

As for 9-11 who was the president for the previous 8 years who did nothing to combat terrorism except disgrace the Oral Office...... Who can forget Blackhawk down when Billy Clinton pulled out our armor and depended on the UN, how did that work out....


From an article about Greece. Could be written about U.S.

"But the real problem with the public sector is the tiny elite of business people who live off the Greek state while passing themselves off as “entrepreneurs.” They bribe politicians to get fat government contracts, usually at inflated prices. They also own many of the country’s media outlets, and thus manage to ensure that their actions are clothed in silence. Sometimes they’ll even buy a soccer team in order to drum up popular support and shield their crimes behind popular protection, as the drug lord Pablo Escobar did in Colombia, and as the paramilitary leader Arkan did in Serbia."



Greece has the EU, ECB, the IMF and others to help bail 'em out and sustain them.

The U.S. is "too big to fail" and has only itself.

"IN A final drive to win votes for the North American Free Trade Association, President Bill Clinton has offered support at the next election for Republicans who vote for it. 'I don't believe any member of Congress should be defeated if they vote for Nafta,' he said."
A bill to implement the North American Free Trade Agreement.

Wouldn't Clinton promising Republicans support in the next election be a form of bribery? Did Clinton really say "I don't believe any member of Congress should be defeated if they vote for NAFTA" or is that false? If false, please show your proof.


"The trouble with socialism is that you eventually run out of other people’s money." - Margaret Thatcher, former Prime Minister of Great Britain

16.4 trillion in debt and soon to be 20 trillion in 2016. We have been betrayed by our government and this is not a Democrat or Republican issue. We have been blind-sided by both. The endless cycle of spend, borrow and print has to come to an end. The Fed's 100 year charter is up this year, call your congressman and demand that they vote to End the Fed. Money creation should be for the benefit of the American people not to enslave it through taxation.

The Big Dog's back

The problem is we don't have Socialism here. We have Vulture Caapitalism, a big Ponzi scheme.


I stand corrected, we have fascism....Central State Planning and Central State control over our economy.


Wrong again Brutus. We have too much socialism. That is what is breaking the budget.

It is the entitlements that are eating up our tax dollars.

Dr. Information

Big Dog is nothing more than a pot stirrer folks. If you say its dark outside, he will say its yellow, and yes, it doesn't make sense, so don't try.

Just breeze right over this persons stuff. All they do is try to light a flame and then run for cover while it burns.


"I am the best friend the profit system ever had," - FDR

It's called corporatism or fascism.

Dr. Information

So many scream.....Don't buy from China, while they sit on their couch....made in China, text on their iPhone...made in China...and watch their TV....most likely made in China.


Be careful what you protectionistas wish for:

"China is Ohio's third biggest export market after Canada and Mexico."

Read more:


President Clinton made China a most favored trading nation years ago.