Imports send US deficit to $618bn
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.THE US trade deficit climbed to an all-time record of $618bn (pounds 331bn) last year, as Americans continued to show a voracious appetite for all things foreign, despite the tumbling dollar. Last December alone produced a shortfall of $56bn, the second worst monthly figure ever.
According to figures from the Commerce Department yesterday, the annual deficit in 2004 was up 24 per cent on 2003, itself a record. December's shortfall was exceeded only by November 2004, when the deficit reached an unprecedented $59bn.
Though US exports last year hit a record $1.15 trillion, they were eclipsed by imports of $1.76 trillion. The US deficit with China alone soared to $162bn, while 2004 also saw record bilateral deficits with Canada, Mexico and the European Union. Imports of foreign oil surged by 36 per cent to a record $181bn, reflecting the rally in global oil prices and increasing domestic demand.
The news reversed the recent rise in the dollar, spurred by a prediction from Alan Greenspan, the Federal Reserve chairman, that the trade deficit would soon start to decline.
Despite the weaker dollar, which makes US exports more attractive to foreign buyers, many analysts fear the trade deficit could actually worsen slightly in 2005, as dollar-denominated imports become more expensive. "We expect the deficit to continue to widen in 2005," Marie-Pierre Ripert, an economist at IXIS, said.
The deficit on current account, the broadest measure of US trade in foods and services, is running at an even higher rate, of $650bn annually, or some 6 per cent of gross domestic product. To finance its external deficit, the US must attract capital inflows of almost $2bn a day, nearly $60bn a month.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments