US Trade Deficit Jumped by 12.1% in 2017

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Others attribute the growth to a failure on the part of the administration to make major changes to America's trade policy.

At the same time, the latest trade figures also reflect the rising value of commodity imports due to higher commodity prices. Imports set a record $2.9 trillion, swamping exports of $2.3 trillion, according to CTV News Canada. -China trade deficit increased 8.1 percent to a record $375.2 billion a year ago.

The U.S. trade deficit widened more than expected in December, hitting its highest level since 2008 as robust domestic demand pushed imports to a record high. Strong consumer demand drives imports higher, effectively exporting US prosperity to China and other exporters.

Trade was a hallmark issue of President Donald Trump's campaign.

The U.S. trade deficit in 2017 was the highest its been since 2008, despite President Donald Trump's repeated promises to reduce the size of the deficit.

Recently, Trump levied steep tariffs on imported solar panel technology and washing machines, which immediately boosted prices for USA consumers.

The US posted all-time record goods exports to 29 countries, with $243 billion exported to Mexico, $130 billion to China and $56.3 billion to the United Kingdom. Both showed the biggest gains since 2011. In December, a strong increase in imports possibly resulted from some suppliers rushing goods into the country at year end, fearing import tariffs in 2018.

"The December trade deficit was a touch wider than what we had penciled in, and suggests a slightly larger drag from trade relative to what the BEA reported in its release of advance GDP". The economists interviewed expected a low value of 52.2 billion Dollars.

Nevertheless, the goods trade deficit with Mexico increased to $71 billion, while that with China rose by $375 billion - the highest level on record.

Imports rose far faster than exports, adding 6.7 percent to reach $2.9 trillion, the highest level ever.

Exports rose 1.8 percent sequentially, stimulated by food and beverage products, industrial supplies and capital goods.