(RTTNews.com) - With the value of exports falling at a much faster rate than the value of imports, the Commerce Department released a report on Thursday showing that the U.S. trade deficit came in slightly wider than expected in the month of August.
The report showed that the trade deficit widened to $44.2 billion in August from a revised $42.5 billion in July. Economists had expected the deficit to widen to $44.0 billion from the $42.0 billion deficit originally reported for the previous month.
A notable decrease in the value of exports contributed to the wider deficit, with exports falling by 1 percent to $181.3 billion in August from $183.2 billion in July.
The value of imports showed a much more modest decrease, edging down by 0.1 percent to $225.5 billion in August from $225.7 billion in July.
Lindsey Piegza, an economist at FTN Financial, said, "Slower global growth continues to reduce demand for American exports, increasing the U.S. trade balance and decreasing momentum in the U.S. manufacturing sector, which had been the silver lining to the recovery earlier this year."
"Despite the decline in several key commodities, heightened energy prices are likely to trump other areas of price reprieve, keeping U.S. imports elevated for at least the near term," she added.
The Commerce Department said the goods deficit widened to $59.3 billion in August from $57.8 billion in July, while the services surplus narrowed to $15.1 billion from $15.4 billion.
The report also showed that the politically sensitive trade deficit with China narrowed to $28.7 billion in August from $29.4 billion in July.
In other trade-related news, the Labor Department released a separate report showing bigger than expected increases in U.S. import and export prices in the month of September.
The Labor Department said import prices rose by 1.1 percent in September, matching a revised increase in August. Economists had expected import prices to increase by 0.7 percent, which would have matched the growth originally reported for the previous month.
Excluding a 4.4 percent jump in prices for fuel imports, import prices edged up by a more modest 0.2 percent in September compared to a 0.2 percent drop in August.
The report also showed that export prices rose by 0.8 percent in September following a revised 1.0 percent increase in August. Export prices had been expected to increase by 0.4 percent.
While agricultural export prices increased by 1.1 percent in September, non-agricultural export prices rose by 0.7 percent.
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Source: NASDAQ
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U.S. Trade Deficit Widens In August Amid Drop In Exports
