U.S. Trade Deficit Hits Six-month High
The U.S. trade deficit has grown as the number of exports has exports decreased and the amount of imports, mainly from China, has increased. According to U.S. News and World Report, most of those imports were computers and cellphones. This is the highest the deficit with China has been in six months.
In May, the deficit reached $41.1 billion, a significant spike from April's $37.4 billion.
The reason the deficit has grown is the comparative lack of exports from the U.S., due largely to a strong dollar and weak growth overseas. Exports reached $182.4 billion, while imports hit $223.5 billion.
As we previously reported, another reason for the dollar's strength is the U.K.'s decision to leave the European Union. According to BBC, the U.S. trade gap with the European Union widened by 13.5 percent.
Jennifer Lee, a senior economist at BMO Capital Markets, told U.S. News and World Report that exports could weaken even more in the coming months as the dollar continues to strengthen.
"Given the way the greenback is headed, and quite likely slower growth in Europe, don't expect too much," she said, regarding U.S. exports in 2016.
While these numbers look frightening, they don't compare too unfavorably to 2015. Through the first five months of 2016, the deficit is 3.5 percent below compared to the same period in 2015. It's also only slightly higher than 2016's first-quarter average of $40.6 billion.