US trade deficit expanded in May 2016 with the strongest pace in nearly an year. The export decreased, while the growth in domestic consumption leads to higher imports of consumer goods and industrial materials. The US trade deficit grows by 10.1% compared to the previous month to 41.1 billion USD, according to the US Department of Commerce. The exports declined by 0.2% to 182.4 billion USD because of weak demand for aircraft, computers, industrial machinery and equipment and automotive parts. The imports grew by 1.6% to 223.5 billion USD.
The US companies imported more cars, mobile phones, clothes and industrial goods, as the largest economy in the world began to revive after a weak first quarter. Meanwhile, the exports faces challenges, such as weak global markets. Moreover referendum for Brexit in Britain worsen prospects for exporters.
The renewed acceleration in imports is in line with the stabilization of consumer spending in the second quarter. We continue to see weakness in overall exports, as a result of a strong currency and more importantly – weak growth abroad.
The good news in the report are that the deficit in trade in petroleum products shrank to 2.9 billion USD in May, which is the lowest result since 1999. The oil prices rose by 4.71 USD during the month, which is the biggest monthly rise in five years.
Eliminating the influence of prices received numbers are used for the calculation of GDP, the trade deficit grows to three-month high of 61.1 billion USD to 57.5 billion USD in April.
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