The combined U.S. goods and services trade deficit in September hit its highest monthly level since May, powered by new records in the trade shortfalls with China and in manufacturing. Here are the China and manufacturing details from the Census Bureau‘s new report. I hope to post on the rest of the September figures later today or tomorrow morning.
>The China goods deficit of $35.56 billion blew past the old mark of $30.86 billion, set in July, by 15.23 percent. The new deficit also represented a 17.77 percent increase over the August level of $30.20 billion.
>U.S. goods exports to the still strongly growing Chinese economy fell on month in September from $9.63 billion to $9.33 billion (3.12 percent). U.S. merchandise imports from China jumped by 12.70 percent over August levels, from $39.83 billion to $44.89 billion – itself an all-time high.
>The U.S. goods deficit with China this year is now so far running 5.62 percent ahead of 2014’s record pace.
>The longstanding U.S. manufacturing trade shortfall shot up from $59.10 billion in August to $69.16 billion in September. This 17.02 percent jump resulted in a beat of the old record of $67.33 billion, also set in July, by 2.72 percent.
>U.S. manufacturing exports fell by 4.90 percent from August to September, from $103.85 billion to $98.76 billion. Manufactures imports increased on month by 3.05 percent, from $162.95 billion to $167.91 billion.
>The year-to-date manufacturing trade deficit of $534.40 billion is running 11.83 percent ahead of 2013’s pace – also a record.
My take: As President Obama prepares for his summit with Chinese leader Xi Jinping next week, these awful U.S.-China trade figures make clearer than ever the need for a complete overhaul of U.S. economic strategy towards the PRC. The deficit’s relentless growth, which drags on America’s recovery and job creation, also signals that the President and trade policy critics alike must deal effectively with the entire range of predatory Chinese trade practices, not simply currency manipulation.
In addition, the new monthly record manufacturing trade deficit makes a new mockery of claims that American domestic manufacturing is in or near renaissance mode, along with the belief that its rebirth is coming largely at the expense of a less and less competitive China.