(Updates with economist comment in fourth paragraph.)
Feb. 10 (Bloomberg) -- The trade deficit in the U.S. widened in December to a six-month high as a strengthening economy prompted bigger gains in imports than exports.
The gap increased 3.7 percent to $48.8 billion from $47.1 billion in November, Commerce Department figures showed today in Washington. Purchases of goods and services produced overseas were the strongest in more than three years on record demand for capital equipment like machinery and semiconductors.
Imports may keep rising as an improving job market underpins consumer spending, and businesses rebuild inventories and replace outdated equipment. At the same time, demand from emerging markets is boosting sales at companies like General Electric Co. and Caterpillar Inc., buffering the fallout from Europe’s debt crisis and helping to sustain exports.
“Growth in consumer and business demand is pretty good and that is helping to pull in imports,” said Jay Bryson, a senior global economist at Wells Fargo Securities LLC in Charlotte, North Carolina, who projected the gap would rise to $49 billion. “We will see a widening trade deficit this year as imports grow faster than exports.”
Stock-index futures slumped on concern over Greece as one of the three party leaders supporting the country’s government said he cannot vote for the current austerity package. The contract on the Standard & Poor’s 500 Index maturing in March dropped 0.9 percent to 1,335.8 at 8:44 a.m. in New York.
The median forecast in a Bloomberg News survey of 75 economists called for the deficit to rise to $48.5 billion from a previously estimated $47.8 billion in November. Estimates ranged from gaps of $43 billion to $50.5 billion.
For all of 2011, the shortfall grew 12 percent to $558 billion, the most since 2008. Both imports and exports climbed to records.
Imports advanced 1.3 percent to $227.6 billion, the most since July 2008. In addition to capital goods, American companies also bought more consumer household items, automobiles and parts and crude oil from overseas.
Exports increased 0.7 percent to $178.8 billion, boosted by record sales of petroleum to buyers overseas. That caused the trade gap excluding petroleum to widen even more than the deficit overall, rising to $21.9 billion in December from $19.4 billion the prior month.
After eliminating the influence of prices, which are the numbers used to calculate gross domestic product, the trade deficit grew to $47.7 billion from $47 billion. The fourth- quarter average of $46.2 billion was larger than the $45.7 billion in the previous three months, confirming that trade subtracted from growth over the period.
The world’s largest economy expanded at a 2.8 percent annual rate in the fourth quarter after a 1.8 percent pace in the prior three months, Commerce Department figures showed on Jan. 27. The trade gap subtracted 0.11 percentage point from GDP in the final three months of 2011, after adding 0.43 points in the prior quarter.
The trade gap with China narrowed to $23.1 billion from $26.9 billion as imports dropped, today’s report shoed.
Exports to the European Union climbed 3.6 percent and imports rose 2.2 percent, leaving the trade gap with the region little changed.
U.S. exporters globally may continue to see gains. Caterpillar, the largest construction and mining equipment maker, posted fourth-quarter profit that beat analysts’ estimates and said prospects for global growth have improved. It also projects more orders as pent-up demand is released and customers replace older products.
“We’re expecting 2012 to be another year of good growth,” Doug Oberhelman, chairman and chief executive officer of the Peoria, Illinois-based company, said in a Jan. 26 statement. “2011 was a record-breaking year for U.S. exports,” which “supported thousands of jobs in the United States.”
China, the world’s second-biggest economy, expanded 8.9 percent in the fourth quarter from a year earlier, exceeding the Bloomberg survey median forecast. An index of India’s services industry rose in January at the fastest pace in six months, and manufacturing accelerated.
“The emerging markets continue to be very strong,” Jeffrey Immelt, chief executive officer of General Electric, said on a Jan. 20 conference call with investors. “There are a few challenged markets like Europe and appliances, but on balance, we have a positive outlook.”
Gap with China
Even with the improvement in December, the trade deficit with China remains a thorny issue as the U.S. presses the Asian country to allow its currency, the yuan, to rise against the dollar. President Barack Obama, in his State of the Union address, said last month he is creating a trade enforcement group that would use investigators and other federal resources to combat unfair trade practices by nations including China.
China’s overseas shipments decreased 0.5 percent in January and imports declined a more-than-forecast 15.3 percent from a year earlier in a month that had four fewer working days than in the same month in 2011 because of the Chinese New Year holiday, the customs bureau said today. That pushed the trade surplus for the world’s second-largest economy up to a six-month high of $27.3 billion, the data showed.
--With assistance from Chris Middleton in Washington. Editor: Carlos Torres
To contact the reporter on this story: Shobhana Chandra in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Christopher Wellisz at email@example.com