U.S. trade deficit hits highest level in 14 years

Photo (c) Leonid Eremeychuk - Getty Images

Economists hope another stimulus will help recovery efforts

The Commerce Department reported Tuesday that the United States’ trade deficit rose nearly 6 percent in August to $67.1 billion -- the highest level since 2006.

Exports of goods and services were worth $171.9 billion ($3.6 billion more than July exports), but imports recovered faster at $239 billion ($7.4 billion more than in July). The widening gap between U.S. imports and exports reflects the impact of the COVID-19 pandemic. U.S. exporters are still struggling to get back to pre-pandemic levels. 

Exports have rebounded slower than imports and are about 18 percent lower compared to the last month before the pandemic. Many investors are optimistic that another fiscal stimulus will help aid the recovery of the global economy and, in turn, increase exports and lower the deficit. 

Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi reportedly had a phone call Monday to discuss a $2.2 trillion relief bill that was approved by House Democrats last week. Pelosi and Mnuchin are expected to speak again on Tuesday. 

“As [U.S.] production continues to ramp up, there is plenty of scope for exports to catch up over the coming months,” said senior U.S. economist Andrew Hunter of Capital Economics.

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