Robust Imports Boost U.S. Trade Deficit to Record High

The US trade deficit widened in December as imports soared, hitting the largest-ever level in all of 2021.

The Commerce Department said on Tuesday that the trade deficit rose 1.8 percent to $80.7 billion in December. November’s data was revised down to $79.3 billion, instead of $80.2 billion in the previous data.

Economists had forecast a shortfall of $83 billion in a Reuters survey.

The deficit jumped 27 percent for the whole of 2021 to $859.1 billion. This is the highest level ever recorded and came compared to a deficit of 676.7 billion dollars in 2020.

“The need to replenish inventory in the United States will keep imports strong even as domestic demand transitions back to services,” said Tim Quinlan, a senior economist at Wells Fargo. “Eventually as domestic demand begins to slow and the global recovery continues, we expect trade to become more of a neutral force on growth next year.”