On Tuesday, the Commerce Department announced that the the deficit for goods and services rose to $566 billion - the highest level since 2008, when it stood at $708.7 billion, the Associated Press reported. To achieve this, he has threatened to cancel trade agreements such as the TPP (Trans-Pacitic Partnership) with Pacific Rim countries and the North American Free Trade Agreement (NAFTA) with Canada and Mexico.
So naturally, in his first year of office, the US trade deficit hit its highest level in nine years.
The Commerce Department released figures on Tuesday that shows the trade gap in goods and services rose to $566 billion previous year, the highest level since $708.7 billion in 2008. Imports from China and Mexico hit record highs The year 2017 saw the USA importing more foreign-made cars, computers, cell phones and other consumer goods, much of which were produced in China. The president recently placed tariffs on imported solar panels and washing machines, sparking concern the US may prompt trade wars.
Imports from Mexico also hit a new record high.
"[.] with imports likely to rise les quickly over the next few months, net foreign trade will be much less of a drag on GDP growth than in Q1". America's merchandise-trade gap with China, the world's second-biggest economy, widened 8.1 percent in 2017 to a record $375.2 billion. Exports of energy products, which had been hit by pipeline disruptions in November, expanded by 6.2 percent to hit the highest level in more than three years. The economists interviewed expected a low value of 52.2 billion Dollars.
Imports surged to $2.9 trillion, easily eclipsing $2.3 trillion in USA exports.
The trade gap widened in December, growing 5.3 percent to $53.1 billion.
Exports rose 1.8 percent sequentially, stimulated by food and beverage products, industrial supplies and capital goods.
"When an economy is at full employment, an acceleration in demand tends to be accompanied by a pickup in import growth and a wider trade deficit", said John Ryding, chief economist at RDQ Economics.
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