Updated from 9:51 a.m. EDT
Foreign goods continued to pour into the U.S. in March at a faster rate than exports poured out, widening the massive
as the heady value of oil imports in March surged thanks to a nine-year high in oil prices.
The deficit, a broad measure of the international trade behavior of the U.S., showed that Americans imported a record $30.18 billion more than they exported in March, the
reported Friday. That figure is up a sharp 5% from February's gap, which was revised downward to $28.71 billion from the originally reported $29.24 billion.
The data came in slightly above many economists' estimates, and highlighted the massive levels of consumer demand in the U.S. as low unemployment, rising equities and rising wages have rendered consumers confident to continue spending money at a feverish pace.
Although the trade gap widened, exports rose a solid 2.9%, indicating that the foreign demand for U.S. goods is rising as overseas economies continue to rebound. Even though aircraft -- which often exert a large influence on overall exports -- slumped due to a strike-related slowdown at
, overall exports rose solidly on strengthening overseas demand for U.S. autos, computer parts, industrial machinery and farm products.
Meanwhile, oil dominated the growth in the value of imports, which rose 3.4% to $117.44 billion.
The value of imported crude oil rose to a record high of $7.6 billion as crude oil prices reached a nine-year high in March at around $34 a barrel and averaged $26.38 a barrel.
Regionally, the trade deficit with China declined slightly to $5.09 billion from $5.62 billion in February, while the deficit with the European Union widened significantly to $5.66 billion from $3.53 billion in February. The shortfall in trade with the ailing Japanese economy widened to $6.82 billion from $6.73 billion the prior month.
has frequently said that the fat trade deficit is something of a thorn in the side of the record-long U.S. economic expansion, voicing worries about the size of the deficit and the imbalance between the supply side and the demand side of the economy.
American's heavy reliance on foreign goods is also seen as damaging because it in turn makes the U.S. dependent on inflows of foreign capital through investments. If U.S. stock markets continue to stagnate as they have in recent weeks, foreign investors might get impatient and begin to pull money out of U.S. stocks and bonds, which would lead to a weaker dollar and a heightened risk of inflation.
In an attempt to slow economic growth and bring supply and demand in the U.S. back to a sustainable level, the Fed has raised interest rates six times over the past year. In theory, higher rates slow growth and curb demand by making it more costly for consumers and business to borrow and spend. But, as evidenced by the persistent levels of the trade gap, the economy has had little reaction to rising interest rates.
That has caused the Fed to get more serious about its efforts. At its latest meeting on May 16, the Fed upped the magnitude of its rate increase to 0.50 percentage point from the 0.25-point increments of the previous five moves.