U.S. Trade Deficit Hits 6-Month High
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WASHINGTON -- The U.S. trade deficit widened sharply in May, as stronger U.S. demand pulled in more imports, a report from the Commerce Department showed. However, sluggish growth abroad pushed exports lower.

The trade gap swelled more than 12 percent to $45.0 billion from a revised $40.1 billion in April, the biggest month-to-month increase in two years.

While the widening of the trade gap could prompt analysts to lower their estimates of second-quarter U.S. growth, the rise in imports points to firming underlying demand in the economy.

Imports rose 1.9 percent to $232.1 billion, the highest since the record level of $234.3 billion set in March 2012.

May imports, when adjusted for inflation, were a record $167.2 billion, the department said.

In another sign of improving domestic economic conditions, U.S. private employers stepped up hiring in June and new applications for unemployment benefits fell for a second straight week last week, pointing to improving labor market conditions.

Private payrolls increased 188,000 last month, the ADP National Employment Report showed Thursday. That compared to 134,000 jobs added in May. Economists had expected a gain of 160,000 jobs.


In a separate report, the Labor Department said initial claims for state unemployment benefits slipped 5,000 to a seasonally adjusted 343,000.

The four-week moving average of new claims, which is considered a better measure of labor market conditions, dipped 750 to 345,500.

The reports come ahead of the government's more comprehensive employment report on Friday.

"This is not really a big game changer, we don't expect any upside or downside surprise on Friday," said Sam Bullard, a senior economist at Wells Fargo in Charlotte, N.C. "Employment should slowly, gradually build momentum."

U.S. stock index futures pared losses, while U.S. Treasuries prices rose after the data. The dollar cut losses against the yen.

Nonfarm payrolls are expected to have increased 165,000 in June, according to a Reuters survey of economists, a touch below May's tally of 175,000 jobs. That would be higher than the monthly average of 155,800 during the past three months.

The unemployment rate is expected to fall a tenth of a percentage point to 7.5 percent. The employment report could shed fresh clues on the timing of the Federal Reserve's plan to start scaling back its monetary stimulus.

Fed Chairman Ben Bernanke said last month the U.S. central bank expected to trim its bond purchases later this year and halt the program by mid-2014, as long as the economy progresses as it expects.


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7 Comments

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rich_paddlyrich

barkin.spiders

IRS spying
Fast and Furious
Benghazi coverup
Obama tapping Verizon phones
Unconstitutional laws
I will not raise any Americans taxes one dime

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You know they use to call Ronald Reagan the Teflon president, nothing would stick to him. Example,..Iran-contra affair, in U.S. history, secret arrangement in the 1980s to provide funds to the Nicaraguan contra rebels from profits gained by selling arms to Iran. The Iran-contra affair was the product of two separate initiatives during the administration of President Ronald Reagan.

July 04 2013 at 2:35 AM Report abuse +1 rate up rate down Reply
oilmlh

Jobs? What job?

July 03 2013 at 11:05 AM Report abuse -11 rate up rate down Reply
1 reply to oilmlh's comment
rich_paddlyrich

ADP National
Employment Report

June 2013

188,000

Change in U.S. nonfarm private sector employment

84,000

Small Business jobs

55,000

Medium Business jobs

49,000

Large Business jobs

1,000
Manufacturing

13,000
Financial Activities

21,000
Construction

oilmlh,.......don't tell me you belong to the party of stupid.

July 04 2013 at 2:46 AM Report abuse +1 rate up rate down Reply
h.hughjardon

Postpone the employer health insurance for a year until after the midterms president hugo? Him and the dems know it's going to be a job killer, and don't want that liability going into the 2014 elections.....this guy wants a dem house and senate again so bad he'll stop at nothing to achieve it, even if it means changing his law at will without any input/approval from our legislators.

What a lawless and corrupt bunch.

July 03 2013 at 10:16 AM Report abuse -8 rate up rate down Reply
1 reply to h.hughjardon's comment
h.hughjardon

LMAO...keep ratin em down spongebob...which screen name you gonna start with today?

July 03 2013 at 12:17 PM Report abuse rate up rate down Reply
cpo1514

Atta boy Barry..... still reporting new unenjoyment claims.... where are the new jobs created numbers??? Keep playing golf and take the prisoner of the WH with you.

July 03 2013 at 9:34 AM Report abuse -8 rate up rate down Reply
1 reply to cpo1514's comment
h.hughjardon

That report usually comes out the first Friday of the month.

July 03 2013 at 10:09 AM Report abuse -12 rate up rate down Reply