The U.S. trade deficit increased to its highest recorded level in 2022, thanks in part to a surging trade deficit with China.
The U.S. registered a roughly $948.1 billion goods and services deficit for the year, including a $382.9 billion goods deficit to China, the U.S. Bureau of Economic Analysis (BEA) revealed Tuesday. This 12.2% surge over 2021 marks an all-time U.S. trade deficit record, The Wall Street Journal reported. (RELATED: White House Sends Out Error-Laden Economy ‘Fact Sheet’ On Eve Of SOTU)
The yearly goods deficit with China increased by around $29.4 billion in 2022 and far outpaced that with any other country: the U.S. reached yearly deficits of about $203.9 billion and $130.6 billion with the European Union and Mexico respectively, recording a $76.2 billion surplus with South and Central America, based on BEA data.
U.S. exports fell by approximately $2.2 billion in December compared to November, coinciding with a $4.2 billion imports surge, the statistics indicate. However, the December goods deficit to China was $3.0 billion higher than during the previous month.
China experienced one of its worst economic growth years in decades and its first-ever population decline since 1961 in 2022, Reuters reported. General Administration of Customs statistics indicated the country’s overall exports sank 9.9% in December, according to CNN.
The U.S. trade deficit rose as the Federal Reserve hiked its target federal-funds interest rate several times in 2022. That trend has continued into 2023, with a 0.25% interest rate increase Wednesday.
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