By Jeffry Bartash
The trade gap widens to $74.6 billion in April
Development of the story. Stay tuned for updates here.
The numbers: The trade deficit rose nearly 9% in April to a 1-1/2-year high due to a surge in imports, a sign that a steadily growing U.S. economy still has plenty of demand.
The deficit rose to $74.6 billion in April from $68.6 billion in the previous month, government data showed.
The widening trade gap could hit gross domestic product, the official measure of the U.S. economy, in the second quarter. A wider deficit also depressed first-quarter GDP.
However, the increase in the deficit in April was largely tied to higher demand for automobiles and industrial supplies, which would be a positive sign for the U.S. economy. A strong dollar has also made buying foreign products cheaper.
Big picture: A large U.S. trade deficit reflects both a stronger U.S. economy compared to other countries and a stronger dollar that makes buying foreign goods cheaper.
Still, growing deficits detract from GDP and this could happen again in the second quarter. However, that doesn't mean the economy has necessarily weakened.
Market Reaction: The Dow Jones Industrial Average DJIA and the S&P 500 SPX had a mixed opening in trading on Thursday.
-Jeffry Bartash
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06-06-24 0838ET
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