The trade deficit unexpectedly widened in November as American retailers stocked up on imported goods for the holidays and demand for foreign automobiles rebounded following superstorm Sandy.
The gap jumped 15.8 percent to $48.7 billion, exceeding all estimates in a Bloomberg survey of economists and the biggest since April, from $42.1 billion in October, Commerce Department figures showed today in Washington. Demand for consumer goods made overseas surged to a record.
Falling petroleum prices prevented the import bill from climbing even more in November and, combined with improvement in the labor market, are boosting household purchasing power. Strengthening global growth may also boost exports in coming months, helping American manufacturers such as Alcoa Inc.
“As we improve and the rest of the world improves, exports and imports are both going to go higher,” said Brian Jones, a senior U.S. economist at Societe Generale in New York, whose forecast of $45 billion was the highest in the Bloomberg survey. “You end up having deterioration in the accounts because I think imports will grow faster than exports.”
Stock-index futures were little changed as concern China will refrain from monetary easing offset Japan’s $116 billion plan to boost the economy. The contract on the Standard & Poor’s 500 Index expiring in March fell less than 0.1 percent to 1,467 at 8:49 a.m. in New York.
Survey Results
The median forecast in a Bloomberg survey of 69 economists projected the deficit would narrow to $41.3 billion. Estimates ranged from gaps of $39.8 billion to $45 billion. October’s deficit was revised from an initially reported $42.2 billion.
Imports increased 3.8 percent to $231.3 billion, the most since April, from $222.9 billion in October. Purchases of foreign-made autos and parts climbed by $1.51 billion and demand for cellular telephones jumped by $1.81 billion, the report showed.
Exports increased 1 percent in November to $182.6 billion, the report showed. The gain was led by sales of automobiles and parts and telecommunications equipment.
After eliminating the influence of prices to produce the numbers used to calculate gross domestic product, the trade deficit widened to $51.9 billion from $46 billion.
The jump may mean that trade subtracted from growth last quarter. Nonetheless, the hit will probably be reduced as some of the imports go into inventory, which boosts GDP. In addition, purchases of foreign-made business equipment point to a pickup in capital investment in the U.S.
Export Outlook
American manufacturers are selling more overseas. The Tempe, Arizona-based Institute for Supply Management said its factory export gauge rose in December to a seven-month high. Commerce Department data show exports slumped in October by the most in almost four years.
Companies such as Alcoa, the largest U.S. aluminum producer, are counting on higher demand from recovering economies led by China.
Alcoa is projecting aluminum prices will rise with “China rebounding, Europe kind of muddling through -- probably a little better than what most people thought -- and the U.S., hopefully avoiding to hit the debt ceiling and growing at the same pace that it has been growing last year,” Chief Executive Officer Klaus Kleinfeld said on a Jan. 8 earnings call.
The November trade data may have also been influenced by port disruptions. Superstorm Sandy made landfall Oct. 29, causing billions of dollars in damage along the East Coast and delaying freight traffic in the region. In addition, clerical workers at the ports of Los Angeles and Long Beach, the largest U.S. port complex, went on strike Nov. 27 for eight days, affecting about $1 billion of trade a day.
Global Rebound
China’s exports jumped 14.1 percent from a year earlier, the most since May, a report showed yesterday. Together with a 19-month high in the pace of China’s manufacturing expansion reported Dec. 31, the figures are boosting optimism that a recovery in the world’s second-biggest economy is gaining traction after a seven-quarter slowdown.
A report from the Labor Department today showed prices of goods imported into the U.S. unexpectedly dropped 0.1 percent in December after falling 0.8 percent the prior month. Economists projected the gauge would rise 0.1 percent, according to the median estimate in a Bloomberg survey.
The cost of imported fuel decreased 0.1 percent in December from the prior month. Import prices minus fuel also declined 0.1 percent last month.
For all of 2012, import prices fell 1.5 percent, the first annual drop since they retreated 10.1 percent in 2008.
