Washington, DC, October 15-- The trade deficit, propelled by a steep foreign oil bill, surged in August to the second highest mark in history.
The Commerce Department said Thursday that the U.S. deficit in international trade of goods and services rose to $54.04 billion in August from an upwardly revised shortfall of $50.55 billion in July. The July deficit was previously reported at $50.15 billion. June's deficit was $55.02 billion, the highest ever. Economists polled by Dow Jones Newswires and CNBC had forecast a deficit of $52 billion.
The nation's $16.08 billion energy bill was in large part responsible for the deterioration in the trade balance. In July, imported energy-related petroleum products totaled $14.18 billion. But in August the average price of a barrel of crude jumped $3.09 to $36.37 -- the highest level since June 1981. Combined with an increase in volume to 331.19 million barrels for the month, the price increase drove the value of imported crude to a record $12.04 billion.
The swelling trade defect could pinch U.S. economic growth. Following the data's release, economists at Morgan Stanley said they were cutting their growth estimate for third-quarter gross domestic product to 4.0% from 4.6%.
Overall imports rose 2.5% to $150.07 billion during August, reflecting record demand for industrial supplies, the Commerce Department said. Imports of industrial materials including oil, iron and steel, and chemicals rose $2.40 billion, while imports of autos and parts were up $137 million. Imports of capital goods like airplanes, generators, and business machines fell $149 million and consumer goods imports fell $15 million. Imported foods, feeds and beverages were down $42 million.
Meanwhile, overall exports rose only slightly, up 0.1% to $96.03 billion in August. Exports of American-made consumer goods, like drugs and furniture, rose $339 million, and exports of autos and parts rose $237 million. Exports of capital goods like airplanes and industrial engines were up $49 million, while exports of industrial supplies dropped $373 million. Sales of foods, feeds and beverages abroad fell $201 million.
