U.S. trade deficit in goods leaps 17% as exports retreat
The numbers: The trade deficit in goods shot up 17% in April to a six-month high of $96.8 billion, reflecting a rebound in imports and a broad decline in American exports.
The trade gap in goods rose from $82.7 billion in March, the Census Bureau said.
Larger deficits subtract from gross domestic product, the official scorecard for the economy.
An advanced estimate of wholesale inventories, meanwhile, showed a 0.2% decline in April. Retail inventories rose 0.2% in the month, according to an early estimate.
Higher inventories add to GDP, but the mixed results suggest little impact.
Key details: Exports dropped 5.5% to $163.3 billion. U.S. companies shipped fewer cars, food, consumer goods, oil and other industrial supplies.
Imports of goods rose 1.8% to $260 billion in April, mostly because of higher oil prices and strong demand among consumers for new cars and trucks.
Big picture: The rebound in imports suggests more capacity for consumers to spend. Car sales this year have been particularly strong as more models become available and dealers offer more discounts.
Auto sales fell last year to the lowest level in 11 years owing to a shortage of vehicles and record prices.
The slowdown in inventory growth, however, indicates businesses are unsure about future demand. They are hedging their bets and don’t want to get caught with excess inventory like they did last year.
Market reaction: The Dow Jones Industrial Average
and S&P 500
rose in Friday trades.
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