Trade Deficit in November Widened to Record Level --- Higher Oil Prices, Hoarding Related to Y2K Spurred Big Increase in Imports
WASHINGTON -- The U.S. trade deficit hit another record in November, swelling to $26.50 billion on a surge of imports of foreign cars and consumer goods.</br></br>The deficit in goods and services, seasonally adjusted, was $940 million more than October's revised and record $25.56 billion, the Commerce Department reported. Higher oil prices helped fuel the rise, and economists also blamed some of the import surge on year-2000 stockpiling, in which many U.S. car dealers built up their inventories in the latter part of 1999.</br></br>But as the trade imbalance continued to swell, there was a tiny ray of sunshine in the November numbers: U.S. export performance, dismal for much of 1999, was slightly improved, rising $557 million to $82.89 billion on increased demand for telecommunications equipment, semiconductors and other products.</br></br>Imports, as usual, outperformed exports, swelling to $109.39 billion from October's $107.90 billion. It was the U.S.'s worst trade performance since the Commerce Department started compiling the monthly numbers in 1992.</br></br>While steadily climbing trade deficits are worrisome politically, they leave many economists sanguine. "The buildup of precautionary inventories ahead of Y2K probably pulled in a few more exports during the fourth quarter," said Mark Vitner, economist with First Union Corp. in Charlotte, N.C. "The continued strength in the U.S. economy, however, is the most important reason imports remain so strong."