Trade Gap Hits Record in September

WASHINGTON —  A growing volume of imported goods during September sent the U.S. trade deficit soaring 15% higher to a record $34.3 billion, the Commerce Department said Tuesday.

Analysts said the worsening trade picture, partly caused by the fact that the U.S. economy remains more vigorous than most of its partners, is cause for concern but was not yet alarming. One worry was that retailers might be overstocking for the Christmas sales season and could be faced with unsold goods at year-end that could force production cuts.

Imports hit an all-time high of $126.62 billion, up 3.1% from the August total of $122.77 billion, while exports fell 0.7% to $92.36 billion.

The steepest oil prices in a decade contributed to the September deficit surge but were not the most important force behind it. Instead, the growing trade gap reflected an increase from August levels in imports of a wide range of goods.

The mounting drag from trade is expected to force a revision downward in the third-quarter measure of U.S. economic performance, which would provide additional confirmation that the U.S. economy has shifted into a lower gear.

“It’s going to knock down the third-quarter [gross domestic product] growth number, so we are probably looking at . . . 2.3% or 2.4% [a year rate of expansion] instead of 2.7%,” said Tim O’Neill of Bank of Montreal/Harris Bank in Toronto.

Prices for imported oil averaged $28.98 a barrel in September, the highest since $29.51 in November 1990 and up from $26.59 in August. The price rise pushed the total cost of imported petroleum products up to $10.27 billion from $10.24 billion in August.

Undersecretary of Commerce Robert Shapiro insisted the report did not signal a widespread economic deterioration.

“While the deficit is too high, it does not reflect problems with the underlying domestic economy,” Shapiro said.

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U.S. Trade Deficit

The overall gap continues to reflect a deficit in the trade of goods and a surplus in servics.

In billions of dollars:

September deficit: -$34.3

Source: Commerce Departmen