WASHINGTON — The U.S. trade deficit expanded in November to its widest point in seven months, driven by a surge in imports that outpaced only modest growth in exports.
The Commerce Department report Friday suggests trade will drag on economic growth in the October-December quarter. A wider trade gap slows growth because it means Americans spent more on foreign products while U.S. businesses earned less in overseas sales.
Still, the report showed consumers have maintained an appetite for spending. They kept buying iPhones and other imported goods in November, despite high unemployment and low wage growth.
“A strong rebound in imports is not necessarily all bad for the U.S. economy because it indicates that consumers are spending. It shows the private sector is not dead,” said Gregory Daco, senior economist at HIS Global Insight.
Gap reaches $48.7B
The trade gap widened 15.8 percent to $48.7 billion in November from October, the report noted. Imports grew 3.8 percent, led by gains in shipments of cellphones, including Apple's new iPhone.