The U.S. trade deficit increased to a five-month high in July as exports of soybeans and civilian aircraft declined and imports hit a record high, suggesting that trade could be a drag on economic growth in the third quarter.
The Commerce Department said on Wednesday the trade gap jumped 9.5 percent to $50.1 billion, widening for a second straight month. Data for June was revised to show the trade deficit rising to $45.7 billion, instead of the previously reported $46.3 billion.
The politically sensitive goods trade deficit with China surged 10 percent to a record $36.8 billion.
Economists polled by Reuters had forecast the overall trade deficit swelling to $50.3 billion in July. The trade gap continues to widen despite the Trump administration’s “America First” policies, which have left the United States embroiled in tit-for-tat tariffs with the European Union, Canada and Mexico as well as an escalating trade war with China.