Record Imports Push US Trade Gap To $55.5 Billion in October

According to AP agency report  record imports in Octoberdrove the U.S. trade deficit to the highest level in a decade. The Commerce Department said Thursday that the gap between the United States sells and what it buys from foreign countries hit $55.5 billion in October, the fifth straight increase and highest since October 2008. The politically sensitive deficit in the trade of goods with China rose 7.1% to a record $43.1 billion. The goods gap with the European Union widened 65.5% to a record $17.6 billion. Led by shipments of medicine and cars, overall imports rose 0.2% to a record $266.5 billion. Exports fell 0.1% to $211 billion. President Donald Trump campaigned on a pledge to slash America’s longstanding trade deficit with the rest of the world. Despite his import taxes on steel, aluminum and Chinese goods, the deficit so far this year is running 11.4% above January-October 2017. U.S. exports of soybeans, targeted for retaliatory tariffs by China, dropped 46.8% in October. Trump sees the lopsided trade numbers as a sign of U.S. economic weakness and as the result of bad trade deals and abusive practices by U.S. trading partners, especially China. He has slapped tariffs on $250 billion worth of Chinese imports in a dispute over the tactics Beijing is using to challenge American technological supremacy. These include the theft of trade secrets and forcing U.S. companies to hand over technology in exchange for access to the Chinese market, the U.S. charges. In a meeting over the weekend, Trump and Chinese President Xi Jinping agreed to a ceasefire in the trade dispute. Details are unclear, but the White House says it agreed to delay a planned tariff increase on $200 billion in Chinese goods for 90 days to buy time for more substantive negotiations.

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Simplify, Americans buy more than they produce, and imports fill the gap...

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US trade deficit on certain countries (Quarterly):
China: $95.9 billion (+ $10.3 billion)
EU: $30.2 billion (+$6.3 billion)
Japan:  $13.4 billion (-$1.9 billion) 

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US trade deficit gets worse...

 

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Collapse of the tariff strategy

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