Are the fundamental reasons for U.S. Dollar weakness getting worse?
*Financial Times, by Christopher Swann, March 9, 2006
Trade gap widens to $68.5bn in the US
“The US trade deficit widened to a record $68.5bn in January, with exporters unable to match the blistering pace of import growth.
The deficit was up $3.4bn on the previous month. The politically sensitive bilateral deficit with China accounted for much of the deterioration, with the shortfall increasing from $16.3bn to $17.9bn.
Overall, exports grew by $2.8bn to $114.4bn but imports far outpaced this rising $6.2bn to $182.9bn.
With exports so much smaller than imports, exports need to rise much faster in percentage terms than imports just to prevent the deficit from widening. Recently American businesses have not been able to manage this and many economist believe that they are unlikely to do so any time soon.”
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