The US trade deficit widened more than expected in March to $63.9 billion, as higher oil prices helped push total imports to the second highest on record, a US government report showed on Thursday.
The trade gap swelled 10.4 percent from February, the Commerce Department said, surprising Wall Street economists who had expected a more modest expansion. The midpoint estimate of analysts surveyed before the report pegged the March trade gap at $60 billion. Overall US imports increased 4.5 percent in March to $190.1 billion, led by a gain of more than 11 percent in imports of industrial supplies and materials to $49 billion.
The volume of March crude oil imports rose to their highest level since August 2006, while the average price for imported oil rose to $53.00 per barrel from $50.71 in February. Record imports of consumer goods and food, feed and beverages also helped push the overall tally higher.
However, US exports had another strong showing, rising 1.8 percent in March to $126.2 billion, second only to the record set in January. US exports to Canada, the European Union - and individually to Germany - and China set records, while shipments to Japan were the highest since March 2001.
The United States also exported record amounts of advanced technology products such as computer, telecommunications, aerospace and electronic equipment. The closely watched US trade deficit with China shrank 6.4 percent to $17.2 billion, as imports from that country were the lowest since May 2006.
Despite widening dramatically in March, the trade gap for the first quarter of the year totalled $180.7 billion, smaller than $191.6 billion in the same period last year when the annual deficit hit a record $765.3 billion.
RETAILERS WEAK US retailers reported weak April sales results on Thursday after cold, stormy weather and an earlier Easter holiday sapped demand for spring merchandise, prompting many to cut their first-quarter forecasts.
Wal-Mart Stores Inc, the world's largest retailer, reported a sharper-than-expected 3.5 percent decline in its US April same-store sales, saying its results were hurt by the weather and the timing of Easter. Easter fell on April 8 this year, compared with April 16 in 2006, pulling sales of holiday-related items largely into March and hurting April figures.
Retailers also faced tough comparisons to the same month a year ago, when record warmth drove sales of spring items, like shorts and dresses. This April, which included a storm that soaked much of the US East Coast and snow storms in parts of the Midwest, was the coldest in 10 years, according to Planalytics, diminishing shopper demand for warm-weather items.
Target Corp warned that its April sales at established stores would be "much weaker" than its forecast of a decline of 2 percent to 4 percent, while Circuit City Stores Inc, struggling with weak television sales, said it expects a first-quarter loss and withdrew its forecast for the first half.
Circuit City does not report results on a monthly basis. On Thursday, retailers including Children's Place, Pacific Sunwear of California Inc and New York & Co Inc cut their first-quarter earnings forecast after reporting weak April sales.
JOBLESS CLAIMS DOWN The number of US workers filing new claims for jobless benefits fell unexpectedly by 9,000 to the lowest level of claims since mid-January, a Labour Department report showed on Thursday.
Initial filings for state unemployment insurance claims slid to 297,000 in the week ended May 5 from an upwardly revised 306,000 the prior week. There were no special factors behind the drop in new claims, a Labour Department analyst said. The last time new claims were this low was in the week ended January 13, when they totalled 287,000.
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