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Montevideo, April 24th 2019 - 22:10 UTC

US exports up but not enough to pay April's oil bill

Wednesday, June 11th 2008 - 21:00 UTC
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Despite healthy exports the rising cost of importing foreign oil caused the US trade deficit to widen 7.8% in April to 60.9 billion US dollars, the largest for 13 months.

Crude oil imports alone increased 4.3 billion to 29.3 billion US dollars over the month, reflecting higher prices for fuel on world markets. The increase wiped out the gains from strong US exports, which grew 3.3%. Analysts warned that the cost of oil imports could rise further in coming months if crude oil continued to climb. "This is the most important hurdle on our road to recovery," Gilles Moec, an analyst at Bank of America, told the BBC. "Real issue is oil and the fact that so far, it is not responding to the accumulating signs of a global slowdown," he added. The US Commerce Department said exports showed the biggest gain in four years, thanks to the weak dollar, which makes American products more competitive abroad. Fast-growing economies in Asia are consuming more US-made goods, such as commercial aircraft and farming machinery. Strong American exports have been one of the few bright spots on the US economic horizon. On Monday, US Federal Reserve Chairman Ben Bernanke said fears of recession had receded and the economic outlook had improved. But analysts said the yawning trade gap between the US and China would raise eyebrows, as it increased nearly 26% to $20.2bn. US lawmakers have argued that the US-China deficit, which makes up the largest share of the total trade gap, is due to what they say is China's policy of undervaluing its currency to make its products cheaper (BBC).

Categories: Economy, United States.

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