U.S. Trade Deficit Widens More Than Expected To $56.8 Billion In November

(RTTNews) - A report released by the Commerce Department on Thursday showed the U.S. trade deficit surged by much more than expected in the month of November.

The Commerce Department said the trade deficit widened to $56.8 billion in November from a revised $29.2 billion in October.

Economists had expected the trade deficit to grow to $45.0 billion from the $29.4 billion originally reported for the previous month.

The wider than expected trade deficit came amid a sharp increase in the value of imports and a steep drop in the value of exports.

The report said the value of imports spiked by 5.0 percent to $348.9 billion in November after tumbling by 3.0 percent to $332.1 billion in October.

Significant growth in imports of consumer goods and capital goods more than offset a decrease in imports of industrial supplies and materials.

Meanwhile, the Commerce Department said the value of exports plunged by 3.6 percent to $292.1 billion in November after surging by 3.0 percent to $302.9 billion in October.

Exports of industrial supplies and materials, including non-monetary gold, slumped during the month along with exports of pharmaceuticals.

"November's report suggests net trade could contribute 0.4ppts to Q4 GDP growth, which adds slight downside risk to our forecast," said Grace Zwemmer, Associate Economist at Oxford Economics.

"While the December trade report won't be released until February 19, data from major US ports suggests exports decreased again, while imports rose," she added. "This could signal another widening of the trade deficit in the next trade report."

The report also said the goods deficit widened to $86.9 billion in November from $59.0 billion in October, while the services surplus crept up to $30.1 billion in November from $29.8 billion in October.