US trade deficit widens as exports hit 10-year low

Trade deficit jumped 16.7% to $49.4 billion in April

WASHINGTON (Reuters) - The U.S. trade deficit surged in April as the COVID-19 pandemic upended the global flow of goods and services, pushing exports to a 10-year low.

The Commerce Department said on Thursday the trade deficit jumped 16.7% to $49.4 billion. Economists polled by Reuters had forecast the trade gap increasing to $49.0 billion in April.

Global lockdowns to slow the spread of COVID-19 have severely disrupted the movement of goods and services between countries, leading to sharp contractions in economic activity. Gross domestic product in the United States declined at a 5.0% annualized rate in the first quarter, the steepest pace of contraction in output since the fourth quarter of 2008.

WHY ECONOMISTS SAY STOCKS ARE RALLYING AS RIOTS AND VIOLENCE ENGULF AMERICA

In April, exports dropped a record 20.5% to $151.3 billion, the lowest since April 2010. Goods exports plunged 25.2% to $95.5 billion, the lowest since September 2009. Exports of motor vehicles and parts fell to $3.8 billion, the lowest since March 1992. Shipments of consumer goods dropped to $10.4 billion, the lowest since April 2006.

A container ship is docked at Maher Terminals in Elizabeth, N.J., May 11, 2020. (AP Photo/Mark Lennihan)

Travel restrictions weighed on exports of services, which resulted in the surplus on the services account narrowing to $22.4 billion, the smallest since December 2016.

THIS MOVE WILL GET PEOPLE BACK TO WORK, FATTEN PAYCHECKS OF 150 MILLION WORKERS

Imports dropped a record 13.7% to $200.7 billion, the lowest since July 2010. Goods imports fell 13.6% to $167.4 billion, the lowest since November 2010.

The import number has been shrinking as the United States waged a trade war with China. A sharp reduction in crude oil imports has also been a factor, with the United States becoming an oil exporter last year. The country posted a record $3.2 billion petroleum surplus in April.

MAJOR US AIRLINES WILL SUSPEND SERVICE TO DOZENS OF DOMESTIC AIRPORTS

In April, imports of automotive vehicles, parts, and engines dropped to $13.3 billion, the lowest since July 2009. Consumer goods imports fell to $43.8 billion, the lowest since August 2013. Petroleum imports declined to $6.1 billion, the lowest since June 1999.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

CLICK HERE TO READ MORE ON FOX BUSINESS