Record foreign exchange deficit in the United States

The US Commerce Department said, on Thursday, that seasonally adjusted data pushed the deficit to $75.7 billion in June, up 6.7 percent, $4.8 billion, from $71.0 billion in May. Analysts expected a smaller deficit of $74.1 billion.

Exports of goods and services increased $1.2 billion, or 0.6 percent, to $207.7 billion, while imports rose $6.0 billion, or 2.1 percent, to $283.4 billion.

In a report reflecting the economy’s performance in the second quarter last week, the Commerce Department reported double-digit growth in consumer spending of 11.8%. Spending on goods rose steadily by 11.6 percent, even as demand shifted from goods to services in parallel with the suppression of the coronavirus epidemic.

On the average of the three months ending in June, the trade deficit rose 36.1 percent year on year, to $19.08 billion, to $71.94 billion. Compared to the three-month moving average in May, the deficit widened by $241 million after a three-month moving average of $1.66 billion in exports, $206.28 billion in imports and $1.98 billion in imports.

US gross domestic product already reached pre-pandemic levels in the second quarter, while corporate inventories were depleting at a rapid pace. Compared to its main competitors, the US economy recovered more quickly from the shock caused by the pandemic, which can be traced back to massive fiscal stimulus, lower interest rates, and a successful vaccination campaign.

However, in the April-June period, foreign trade was the factor driving GDP growth down for the fourth consecutive quarter, albeit to a much lower degree than in previous quarters.

The US economic growth rate may exceed 7 percent this year, the best number since 1984. Last year, the US economy had its worst performance in 74 years with a 3.5 percent decline.