Kabir's Econ Blog

November 14, 2009

Trade gap widens sharply in September

Filed under: Uncategorized — kabir1892 @ 10:06 am

deficit

The US trade deficit widened sharply in September due to the lack of global activity since the financial crisis hit in fall of 2008.

The US trade deficit expanded 18.2% in September. The one-month worsening in the deficit is the largest since February 1999. Since January, this is considered as the largest trade gap. Imports have risen up to 5.8%, which is the largest percent increased in imports since February 1993.

Exports rose as well  in September, up to 2.9%. This is the fifth consecutive monthly gain in exports.

Global trade activity sopped last fall since the financial crisis turned the global recession the worst its been since World War II. Companies selling their products found no buyers and were unable to obtain the credit that was necessary in keeping products flowing.

Due to this, the US trade deficit was cut in half as it reached $60 billion in the summer of 2008. In May, it reached $26.4 billion which is considered the lowest level since November 1999.

However, now that we are on the path to recovery, economists are watching the pace of the decline in the deficit carefully.

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