The U.S. trade deficit widened more than forecast in January as exports slumped to the lowest level in more than four years.
The gap grew 2.2% to $45.7 billion, exceeding all forecasts in a Bloomberg survey of economists and the largest in five months, from a revised $44.7 billion in December that was bigger than previously estimated, the Commerce Department reported Friday in Washington.
Soft growth plaguing U.S. trading partners is also reducing the amount of goods and services the world’s biggest economy can ship out, pinching manufacturers. Demand from American consumers will be needed to pick up the slack, putting even more importance on an improving labor market that translates into real wage growth.
“Exports and imports are both tracking negative,” Jacob Oubina, a senior U.S. economist at RBC Capital Markets LLC in New York, said before the report.
The median forecast in a Bloomberg survey of 63 economists called for a deficit of $44 billion. Estimates ranged from $39.1 billion to $45.3 billion.
After eliminating the effects of price fluctuations, which generates the numbers used to calculate gross domestic product, the trade deficit grew to $62 billion in January from $60.1 billion the previous month. It exceeded the average for the fourth quarter, indicating trade is on track to subtract from economic growth in the first three months of the year.
Exports dropped 2.1% to $176.5 billion in January, the lowest since June 2011. The decrease was broad-based, stretching from soybeans to fuel oil and drilling equipment.
Imports also slumped 1.3% to $222.1 billion, the weakest since April 2011. The drop was led by a $1.85 billion plunge in purchases of crude oil. The total value of petroleum imports was the lowest since November 2003.