US trade deficit widens in March as both imports and exports hit record highs

The US trade deficit widened in March at the fastest rate in 10 months, official figures from the Commerce Department showed Thursday, with a rise in consumer goods lifting imports to a record level and cancelling out gains in US exports.

Data from the Commerce Department put the deficit at $51.8 billion in March, up from $45.4 billion February, the BBC reports. The 14 percent rise was the sharpest month-to-month increase since a 16 percent jump in May 2011. Growing demand for foreign cars, mobile phones, clothing and oil saw imports rise by 5.2 percent to $238.6 billion, negating a 2.9 percent rise in exports to $168.6 billion.

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According to the Associated Press, sales to Europe reached an all-time high, despite the debt crisis currently raging in the euro zone. Exports to the 27 European Union states rose 11.5 percent to $25.1 billion, although imports from the EU also reached record levels, rising 22.7 percent to just below $35 billion.

The greater-than-expected rise follows government data released Wednesday showing that wholesale inventories grew less than expected in March, leading analysts to conclude that Washington will have to lower its first-quarter estimate of gross domestic product from the 2.2 percent rate published last month, Fox Business reports.

The US trade deficit is running at an annual rate of almost $600 billion, which is around 7 percent more than the previous year.

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