American trade deficit takes a dip

In December the U.S. trade deficit took a huge dip as a strong dollar and a weak global demand weighed heavily on exports. On Friday the Department of Commerce said that the trade gap increased by 2.7% to $43.4 billion, this compared to November's trade deficit which was reported to be down by $42.2 billion as opposed to the figure of $42.4 billion that was previously reported.

Economists interviewed by Reuters News Agency last year, had predicted that a trade shortfall of $43.0 bilion would occur in December 2015. Meanwhile the dollar gained 9.2% against the currencies of the country's main trading partners in 2015, thereby slowing the demand for U.S- produced products in the overseas market. Thus trade has increaingly slowed down- subtracting half a percentage point from GDP in the last quater of 2015, only to sustain a 0.7% annual rate. In the first quater of 2016, trade is still expected to stagnate.

Tags: 
market
trade