Trade Gap Widened to $10.29 Billion During January as Imports Surged
WASHINGTON -- Surging imports from Europe and Japan caused the U.S. trade deficit to widen to $10.29 billion in January from $8.03 billion the previous month, the Commerce Department said.</br></br>The widening in January came despite a 3.3% decline in the value of petroleum imports, which are often volatile. Total imports rose 9.2%.</br></br>The large January deficit makes it clear that the easing of the nation's trade problems at the end of last year was temporary, reflecting a slowdown in imports as a result of sluggish economic growth in the third quarter.</br></br>Commerce Secretary Malcolm Baldrige said the 10% rise in the value of the dollar last year, plus the 9% jump since December, could push the deficit to a record $140 billion this year. The trade deficit in 1984 was a record $123.31 billion, compared with $69.39 billion in 1983, the previous record.</br></br>A strong dollar can widen the trade deficit by lowering the cost of imports to U.S. buyers and raising the cost of exports to foreign buyers. The problem is exacerbated by strong economic growth in this country, which encourages the purchase of foreign goods, and relatively sluggish growth overseas, which discourages purchases of U.S. products.