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 user 2006-10-24 at 4:13:00 pm Views: 32
  • #16836

    US trade deficit surges in August
    US trade deficit widened by more than expected during August, raising
    concerns about the state of the world’s largest economy.

    deficit was $69.9bn (£37.7bn) in August, up from July’s $68bn level,
    the US Commerce Department said.The deficit is on course to set a new
    record, totalling $784.2bn at the end of August, 9.4% higher than a
    year ago.One of the main causes of the shortfall has been high oil
    prices, which have pushed up petroleum import costs.The total value of
    imports rose by 2.4% to $192.3bn in August, while exports rose by 2.3%
    to $122.4bn.During August, the politically charged trade deficit with
    China rose by 12.2% to a monthly high of $22bn. The is on course to top
    last year’s record figure of $202bn.

    ‘Bad figure’
    the announcement, some analysts said that they would have to rework
    their economic growth forecasts for the three months to the end of
    September.”It is a pretty bad figure,” said David Sloan of 4Cast in New
    York. “We now expect to see a pretty weak third quarter growth figure,
    significantly below 2%.”However, analysts said that a 25% drop in the
    price of crude oil since August would mean an improvement in the
    deficit later this year because import costs would have declined.But
    that may come too late to help Mr Bush and his Republican party in the
    mid-term elections scheduled for November, analysts said.Democrats are
    arguing that the size of the budget deficit, and especially the
    shortfall with China, are evidence that the Bush administration is
    mishandling trade and economic issues.At the same time there are
    concerns about the housing and labour markets.The Commerce Department
    also released unemployment figures on Thursday, showing that the number
    of new applications for unemployment benefit rose by 4,000 last week to