The US trade deficit rose to its highest level since 2008 in December as strong domestic demand led to surging imports.
Official data showed the US deficit in goods and services jumped to $53.1bn in December, an increase of $2.7bn from November, and markedly higher than economists´ consensus forecasts for a deficit of $52bn.
Imports for December were up by $6.2bn versus November.
Rising imports was a factor in the recent slowdown in economic growth reported for the US in the fourth quarter, the 2.6% expansion comparing with the annual 3.2% growth of the prior quarter.
At the same time, the latest trade figures also reflect the rising value of commodity imports due to higher commodity prices.
The increase in the trade deficit is highly sensitive at present given the Trump administration´s current crusade to simultaneously boost economic growth but improve the balance of trade.
It would suggest the administration will struggle to bring down the deficit, especially as some $1.5tn in tax cuts work their way through the system, a factor that could be expected to boost domestic demand further.
Economists also point to the low level of US unemployment, at just 4.1%, and the current strength in the US labour market.
On Friday, payroll data surprised on the upside while wage inflation rose at its fastest rate in around eight years.
“When an economy is at full employment, an acceleration in demand tends to be accompanied by a pickup in import growth and a wider trade deficit,” said John Ryding, chief economist at RDQ Economics.