August 11, 2010
The US trade deficit in June has reached its widest point in the past 20 months on the rising imports and weakening exports – an indication of a slow economic recovery.
The US trade gap in June was on its fastest track since October 2008, reaching USD 49.9 billion, and disappointing expectations about a growing economy.
“This is spectacularly terrible,” economist Ian Shepherdson of High Frequency Economics said on Wednesday, explaining that rising imports eat in to already anemic US growth figures, AFP reported.
- A d v e r t i s e m e n t
Imports in June showed a three percent rise to hit USD 200.3 billion, while exports fell by 1.3 percent to USD 150.5 billion, the Commerce Department said.
The June deficit bewildered both the government and private economists.
“The slowing in exports will only fan fears of a faltering US recovery,” said Sal Guatieri, an economist at BMO Capital Markets, AP reported.
Most expert estimations put June’s deficit at around USD 42.2 billion.
Facing lackluster growth and a high jobless rate, the US Federal Reserve on Tuesday vowed to renew crisis-era measures that pumped hundreds of billions of dollars into ailing markets to prevent the economy from falling into another recession.
US President Barack Obama has put export growth high on his agenda.
Obama is seeking to double US exports during the next five years to about USD 3.1 trillion by 2015.