US News and World Report has noted that the US trade deficit has risen, unexpectedly, to six year highs:
The Commerce Department said on Friday the trade gap widened 3.2 percent to $50.5 billion. That was the highest level since January 2012 and followed an upwardly revised $48.9 billion shortfall in October.
Economists polled by Reuters had forecast the trade deficit increasing to $49.5 billion in November after a previously reported $48.7 billion deficit in the prior month.
Part of the rise in the trade deficit in November reflected price increases. When adjusted for inflation, the trade deficit rose to $66.7 billion from $65.6 billion in October. The so-called real trade deficit for October and November was above the third-quarter average of $62.0 billion.
And even though imports have increased as well, China, it appears, isn’t to blame:
Imports from China were unchanged in November. Exports of goods increased 2.3 percent to $200.2 billion in November, the highest on record. There were strong increases in exports of industrial supplies, petroleum and capital goods.
Although this growth is accompanying higher demand, it’s hard to read this as a feel good story. Ultimately, the deficit is increasing even on the back of significant dollar weakness. And with a weakened WTO, a rescinded TPP, and faltering NAFTA and South Korea talks, I don’t see too many platforms available to reverse the trend in ways that won’t likely hurt US consumers.