The US trade deficit widened more than expected in January to a record $68.5 billion as record imports fuelled by high oil prices outstripped record exports propelled by stronger foreign demand.
The monthly trade gap swelled 5.3 per cent from a revised estimate of $65.1 billion in December. It also surpassed a median forecast of $66.5 billion made by Wall Street analysts.
January's biggest-ever monthly deficit follows a record annual trade deficit of $723.6 billion in 2005. The trade gap would easily set a new record, exceeding $800 billion, in 2006 if it continued to run at the pace set in the first month of the year.
The higher-than-expected trade deficit could prompt economists to lower their estimates of first-quarter US economic growth.
The United States ran an $8.4 billion deficit with Opec growing 11.6 per cent from December. But analysts pointed out that expensive oil was not the only reason behind the growing trade gap. Overall imports were $182.9 billion, up 3.5 per cent from December.
Imports set records in several categories, including food, feeds and beverages, industrial supplies and materials, capital goods, autos and auto parts, and consumer goods.
"You can't blame it all on energy because the trade deficit excluding petroleum rose faster than the overall deficit. The main culprit once again continues to be that imports are growing faster than exports," said Michael Sheldon, chief market strategist at Spencer Clarke in New York.
The monthly trade gap with China widened 9.9 per cent to $17.9 billion in January. The persistent deficit with China, the United States' largest with any single country, has fuelled charges in Congress that China is an unfair trader that manipulates its currency to gain a trade advantage.
Manufacturers and politicians have demanded that Beijing revalue its yuan currency.
In a sign of improved economic growth overseas, US exports also increased in January to a record $114.4 billion, up 2.5 per cent from the prior month. The export rise was led by record shipments of industrial supplies and materials, capital goods and auto and auto parts.