Milwaukee, Wisconsin 2021-04-07 11:23:59 –
AP Business Writer
Silver Spring, Maryland (AP) — The US trade deficit in February rose to a record $ 71.1 billion, more than a decline in exports offset a slight drop in imports. Slightly low gap.
According to the Commerce Department, the February gap between what the US buys abroad and what it sells abroad was 4.8% above the corrected January deficit of $ 67.8 billion.
The coronavirus pandemic has curtailed world trade for over a year, but these barriers are diminishing as millions of people have been vaccinated and countries have begun to ease operational restrictions on businesses. It seems. Two months after 2021, total trade is only 1.8% behind this point last year, before the global economy was hit by a pandemic.
The deployment of the US vaccine, which was hit by at least one shot on the arms of more than 100 million Americans, is far ahead of other major global economies in Europe and Asia.
If this trend continues, economists believe that as the US economy gets into full swing, it will accelerate its return to “normal business” and further widen the trade gap.
“The trade deficit is ready to grow as the US recovery surges in the spring and summer,” said Oren Crackin of Oxford Economics in a note to clients. “Better health, resumption and fiscal stimulus will boost domestic demand and continue to drive imports strongly.”
The increase in the trade deficit in February reflects a seasonally adjusted export of goods and services down 2.6% to $ 187.3 billion. This wiped out a 0.7% decline in imports, down from a record $ 260.1 billion in January.
The product deficit in February, up from $ 85.2 billion in January, was a record high of $ 88 billion. The $ 5 billion decline in commodity exports was driven by a $ 2.5 billion decline in the capital goods category.
The service surplus of $ 16.9 billion in February was the lowest since January 2012 due to a decline in travel service exports. The United States generally has a large deficit in goods and a surplus in services such as travel and transportation.
Two months after 2021, the year-to-date trade deficit was $ 138.9 billion, more than 68% higher than the $ 82.4 billion in January and February 2020.
Commodity deficits with China increased by 11.4% from January to $ 30.3 billion in February, and commodity deficits with Mexico decreased by 42.9% from $ 11.9 billion to $ 6.8 billion.
President Joe Biden and his team were relatively quiet about their predecessor’s hard-line trade policy. Biden seems to be focusing on domestic policy so far, and has not proposed to stop the trade war with China by former President Donald Trump or reduce tariffs on imported steel and aluminum.