WASHINGTON – The U.S. trade deficit climbed to the highest level in five months in February as demand for American exports fell, while imports increased slightly.
The deficit increased to $42.3 billion, which was 7.7 percent above the January imbalance of $39.3 billion, the Commerce Department reported Thursday.
U.S. exports slipped by 1.1 percent, to $190.4 billion, as sales of commercial aircraft, computers and farm goods fell. Imports edged up by 0.4 percent, to $232.7 billion, reflecting gains in imports of autos and clothing that offset a drop in crude oil to the lowest level in more than three years.
A higher trade deficit acts as a drag on economic growth because it means U.S. companies are making less overseas than their foreign competitors are earning in U.S. sales.
The wider February deficit prompted some economists to reduce their estimate for overall economic growth for the January-March quarter. Economists at Macroeconomics said they had trimmed their tracking estimate for overall growth, as measured by the gross domestic product, to a 0.9 percent rate in the first quarter, down by half of a percentage point because of the larger trade deficit.
For the first two months of this year, the deficit is running 4.5 percent below the same period in 2013, when the deficit dropped to $474.9 billion, 11.2 percent below the annual deficit in 2012.
Many economists expect the trade deficit will keep narrowing this year as exports, helped by an energy production boom in the United States, grow faster than imports. But analysts expect that the improvement will be modest because they are also looking for imports to rise as a stronger U.S. economy and higher consumer spending attract more foreign goods. A domestic energy boom has boosted exports and reduced U.S. dependence on foreign oil. U.S. petroleum exports rose to an all-time high of $137.2 billion last year, up by 11 percent from 2012. Energy imports fell by 10.9 percent, to $369.4 billion, as domestic production took the place of some imports.
For February, energy exports dropped by 10.2 percent, to $11.1 billion, while petroleum imports fell by 2 percent, to $31 billion. Crude oil imports fell to $19.5 billion, the lowest level since October 2010.
The deficit with China dropped by 25.1 percent in February, to $20.9 billion.