The U.S. trade deficit widened in August as slower global growth reduced demand for American exports.
The gap grew 4.1 percent to $44.2 billion from $42.5 billion in July, Commerce Department figures showed today in Washington. Exports decreased to the lowest level since February. A separate report showed the cost of goods shipped to the U.S. rose more than forecast in September.
A stagnant Europe and slower growth in China and other emerging markets may curtail demand for American products, which had been a source of strength for U.S. manufacturers earlier this year. At the same time, the pickup in energy costs may push up the nation’s import bill, keeping the trade gap elevated.
“For the first time, the U.S. economy is gradually feeling the impact from the global growth slowdown,” said Harm Bandholz, chief economist at UniCredit Group in New York, who forecast the deficit would widen to $44 billion. “In the third quarter, the weaker global economy will leave its mark also on the U.S.”
The median forecast in a Bloomberg survey of 73 economists projected the deficit would expand to $44 billion. Estimates ranged from a gap of $41 billion to $47.5 billion. July’s deficit was revised from an initially reported $42 billion.
Fewer Americans than forecast filed first-time claims for unemployment benefits last week, which may reflect difficulty adjusting the data for seasonal swings at the start of a new quarter, figures from the Labor Department also showed today.
Applications for jobless benefits dropped 30,000 to 339,000 in the week ended Oct. 6, the fewest since February 2008. Economists forecast 370,000 claims, according to the median estimate in a Bloomberg survey. One state accounted for most of the plunge in claims, a Labor Department spokesman said as the data were issued to the press.
Stock-index futures held earlier gains after the reports. The contract on the Standard & Poor’s 500 Index maturing in December climbed 0.5 percent to 1,434 at 9:04 a.m. in New York.
The trade report from the Commerce Department showed exports decreased 1 percent in August to $181.3 billion.
Imports decreased 0.1 percent to $225.5 billion, also the weakest since February, from $225.7 billion in the prior month. Purchases of autos, clothing and aircraft from overseas dropped.
After eliminating the influence of prices to produce the numbers used to calculate gross domestic product, the trade deficit climbed to $48.4 billion from $47 billion. It averaged $47.7 billion so far in the third quarter, up from $46.9 in the previous three months, indicating trade will subtract from growth.
A separate report from the Labor Department showed prices of goods imported into the U.S. climbed 1.1 percent in September for a second month. Economists projected the gauge would rise 0.7 percent, according to the median estimate in a Bloomberg survey.
The cost of imported fuel increased 4.4 percent in September from the prior month. Import prices minus fuel rose 0.2 percent last month, the first gain since April.
The trade report showed the value of imported crude oil was little changed in August at $25.8 billion. An increase in the cost of a barrel of crude to $94.36 from $93.83 was almost totally offset by a drop in the number of barrels bought.
The slackening world economy is weighing on sales at companies such as Caterpillar Inc. (CAT:US), which cut its forecast for 2015 earnings after commodity producers reduced capital spending. The world’s biggest construction and mining equipment maker said profit will be $12 to $18 a share, compared with previous projections of $15 to $20.
Peoria, Illinois-based Caterpillar is forecasting moderate and “anemic” growth through 2015, Chairman and Chief Executive Officer Doug Oberhelman said Sept. 24 in a presentation to analysts at a conference in Las Vegas. Construction in emerging markets will probably show modest improvements, he said.
“We’ve seen a slowing in economic growth that was more than we expected,” he said. “We think ‘13 could look like 2012 in terms of worldwide economic growth.”
The International Monetary Fund on Oct. 9 cut forecasts for global growth to 3.3 percent this year, the slowest since the 2009 recession, and said there are “alarmingly high” risks of a steeper slowdown. The Washington-based lender projects the 17- country euro area economy will contract 0.4 percent in 2012, worse than its prior forecast, while the U.S. will expand 2.2 percent, faster than an earlier prediction.
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