By Yuka Hayashi 

WASHINGTON -- U.S. exports and imports both rose for a fifth straight month in October, reflecting a continued recovery in global commerce driven by a strong economic rebound in China.

Exports from the U.S. rose 2.2% to $182.0 billion from the previous month, while imports rose 2.1% to $245.1 billion, the Commerce Department said Friday. The trade deficit widened to $63.1 billion from $62.1 billion. The figures were adjusted for seasonal variations.

Global trade has recovered more quickly than economists expected since widespread lockdowns were imposed in March and April, but activity remains well below pre-pandemic levels. Economists say the outlook for trade remains uncertain amid a resurgence of the virus and renewed lockdowns in the U.S. and Europe.

"Virus transmissions remain elevated, and widening restrictions on activity, at home and abroad, have the potential to disrupt supply chains and weigh on demand," Rubeela Farooqi, chief U.S. economist for High Frequency Economics said in a research note.

Compared with a year earlier, U.S. exports in October were down 13.5%, while imports fell 3.3%. The deficit increased 47% year-over-year.

A rapid recovery in China, which reported a 4.9% expansion in its economy in the third quarter from a year earlier, is helping drive global commerce. The International Monetary Fund projects China will be the only major world economy to grow this year.

U.S. goods exports to China rose to a record $14.72 billion in October from $11.54 billion in September, without adjusting for seasonal variations. Imports from China rose to $44.83 billion from $41.21 billion, hitting the highest level since December 2018.

Adjusted for seasonal fluctuations, however, exports of goods to China rose 9.3% to $13.14 billion in October, while imports expanded 9.1% to $39.68 billion. That left the trade deficit 9% wider at $26.55 billion.

As part of the "Phase One" trade deal signed in January, Beijing committed to buying an additional $200 billion of American-made goods and services over 2020 and 2012. Due in part to the pandemic-induced slowdown, China has remained behind the pace to reach the goal, said Chad Bown, a senior fellow at Peterson Institute for International Economics

"Despite the good news about the additional U.S. exports in October, China's purchases remain only at 57% of their year-to-date targets set out under President Trump's Phase One agreement." he said. "To meet the annual target, China would need to buy more than half of the goods it promised for all of 2020 in November and December alone."

In the 10 months through October, China-bound exports of goods rose to $95.82 billion, from $87.44 billion in the same period last year. Imports fell to $348.72 billion, from $381.55 billion a year earlier. Exports of services to China have remained depressed due to sharp drops in tourism and education spending.

In October, U.S. imports of consumer goods, including cellphones, rose to $57.19 billion from $55.78 billion in September, reflecting a recovery in domestic demand.

Meanwhile, imports of capital goods -- a proxy for domestic investments by companies -- rose to $56.88 billion in October from $55.51 billion in September, led by higher purchases of computer accessories and industrial machinery. Automotive imports rose to $32.20 billion from $31.19 billion a month earlier as consumers took advantage of low interest rates to buy cars.

Year-to-date through October, U.S. exports overall were down 16.4% compared with the same period last year, while Imports were down 11.5%. As imports have recovered more quickly than exports, the overall deficit in goods and services has widened by 9.5% to $536.69 billion.

Write to Yuka Hayashi at


(END) Dow Jones Newswires

December 04, 2020 15:52 ET (20:52 GMT)

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