Trade deficit hits $60.9b in April
Oil is crucial factor, as both imports and exports set records
WASHINGTON - The US trade deficit widened in April as the surge in oil prices propelled imports to a record, overshadowing the biggest gain in exports in four years.
The gap grew 7.8 percent to $60.9 billion, more than forecast and the most since March 2007, the Commerce Department said yesterday. Excluding petroleum, the shortfall was little changed. March's deficit was revised lower.
The figures led some economists to estimate that first-quarter growth was greater than previously estimated by the government, even as fuel prices push imports higher. The dollar's two-year slide, coupled with stronger growth in Europe and Asia, is spurring demand for planes built by Boeing Co. and machinery made by Deere & Co.
"The hyper-competitiveness of the dollar, plus reasonable growth in our export markets, that combination has proven to be very powerful," said Joshua Shapiro, chief US economist at Maria Fiorini Ramirez Inc. in New York. "Trade's been a buffer; it's kept GDP in positive territory. It's clearly a cushion."
Exports climbed 3.3 percent, the most since February 2004, to a record $155.5 billion, led by sales of commercial aircraft, autos, and agricultural machinery.
After adjusting the numbers for inflation, the figure used to calculate gross domestic product, the trade deficit shrank to $46.9 billion, the lowest since August 2003. Combined with the smaller gap now reported for March, the figures may boost forecasts for growth.
Morgan Stanley economists predicted first-quarter economic growth will be revised higher to 1.1 percent, from a previously reported 0.9 percent.
"A lot of it is in the value of oil," Jay Bryson, global economist at Wachovia Corp. in Charlotte, N.C. "Exports did pretty well. This is consistent with strong growth in the rest of the world helping our exports and also a weak dollar."
The trade gap was forecast to widen to $60 billion, according to the median estimate in a Bloomberg News survey of 70 economists. The March shortfall was revised down to $56.5 billion from a previously reported $58.2 billion.
Imports grew 4.5 percent in April, the biggest gain since November 2002, to a record $216.4 billion. The average price of imported petroleum, at $96.81 a barrel, and the total amount of the fuel bought, were both the highest ever.
