US deficit deepers

by brian_turner

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Attempts by the US treasury to impact the trade deficit with a devalued US dollar seem to be failing, as the deficit increased by a massive 20% - according to figures from the US Commerce Department for November 2003.

The US trade deficit now stands at an all-time record of $60bn (’31.7bn).

In the figures released, exports were down 2.3% while imports grew 1.3%. The situation was made worst by high oil prices, which especially imported the import

In the past three years the dollar has fallen by 50% against the euro - as well as by 30% against the yen. You can see graphs of the fall over 2004 here: US Dollar in 2004: highs and lows and also compare it graphically to the GBP in Great British Pound: stronger and stronger?.

The news of the increased deficit is a massive embarassment to US treasury officials, and was far larger than market expectations, who consequently punished the dollar with further loss of value on the foreign exchange markets - nearly a whole percentile lost against the GBP.

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