TRADE deficit widens to $29.4 billion in June as exports fall faster than imports
Friday, August 17th 2001, 12:00 am
By: News On 6
WASHINGTON (AP) _ The U.S. trade deficit widened in June as sales of American-made goods to other countries declined by a larger amount than imports, reflecting the impact of a global slowdown.
The Commerce Department reported Friday that the trade imbalance increased by 3.3 percent to $29.4 billion in June, matching many analysts' expectations.
Exports of goods and services fell by 2 percent to $86 billion in June as economic turmoil overseas sapped demand.
That decline comes as U.S. manufacturers complain that the value of the dollar is too strong, making their goods expensive abroad. They have been pressing the Bush administration to take steps to change that.
Meanwhile, imports of goods and services, hurt by flagging demand because of the ailing U.S. economy, declined in June by 0.7 percent to $115.4 billion.
June levels of both exports and imports were the lowest since February 2000.
For May, the deficit was revised to $28.5 billion, slightly larger than the government's previous estimate.
The latest snapshot of trade activity comes as President Bush seeks unilateral authority to negotiate any trade accord on behalf of the United States, something Congress refused to give former President Clinton.
Bush faces stiff opposition on Capitol Hill for such ``fast-track'' trade authority. Many lawmakers want to condition further trade liberalization on improving environmental and labor standards abroad.
White House officials say fast-track authority would help the sagging economy by lifting tariffs that discourage other countries from buying American goods and services.
But organized labor and other critics contend jobs would be lost and the environment would suffer if Bush were given unfettered power to negotiate trade deals.
Through the first six months of this year, the trade deficit swelled to $184.9 billion, compared with $178.1 billion during the same period last year. For all of last year, the deficit mushroomed to a record $375.7 billion.
In June, the $13.5 billion worth of exported industrial supplies and materials, such as chemicals and metals, was the lowest since October 1999. Sales of U.S.-made capital goods, such as semiconductors and drilling equipment, slipped to $27.1 billion. Sales of consumer goods, including jewelry and household goods, also dipped to $7.4 billion. But exports of automobiles, engines and parts gained ground, totaling $6.6 billion in June, the highest level since August 2000.
On the import side, sales to the United States of industrial materials, including energy products, chemicals and steel, took the biggest hit, declining to $23.9 billion. That was the lowest level since April 2000. Imports of capital goods, including computers, planes and medical equipment, decreased to $24.3 billion in June, the lowest level since May 1999.
Meanwhile, the United States' politically sensitive deficit with Japan widened by 3.8 percent in June to $5 billion. The U.S. deficit with China grew by 7.6 percent to $6.6 billion. The deficit with Mexico widened to a record $3.1 billion.