Sunday, March 15, 2009

Even The Good News Is Bad

US trade deficit continues fall

The US trade deficit sank further in January, falling to its lowest level in almost six years as the slowdown in the economy cut demand for imports.

The monthly deficit, the difference between what the US exports and imports, narrowed by 9.7% to $36bn (£25.7bn) from December's $39.9bn.

The sixth consecutive deficit drop came on falling oil prices and slowing demand for Chinese consumer goods.

Less demand for US-made goods has been impacting on the nation's economy.

While exports had not fallen as sharply as imports, major firms such as Boeing and Caterpillar have announced job cuts due to falling demand for their products in key export markets.

Concerns

The US deficit with Canada, the US's biggest trading partner, fell by 10.7% to $2.5bn.

And the deficit with Japan slipped 18.4% to $4.3bn, the lowest trade gap with that country since January 1998.

Official figures released last week showed that the US unemployment rate reached 8.1% in February.

With more people out of work, and others concerned about their job security, US consumers have been cut back their spending.

This has had the knock-on effect of reducing exports to the US from China and other nations with extensive production bases.

Story from BBC NEWS:
Post a Comment