The U.S. trade deficit soared to $80.2 billion in November, near the record high of $8.14 billion hit in September, the Commerce Department said Thursday.
In October, it had fallen to a revised $67.2 billion. Analysts had forecast a much smaller gap of $71.6 billion.
Imports into the U.S. jumped 4.6 percent to $304.4 billion while U.S. exports slinked up a mere 0.2 percent to $224.4 billion.
The goods deficit jumped 18 percent to a record $98.99 billion. The services surplus grew 12.7 percent to $18.1 billion.
Financial and business services are the biggest U.S. services exports, at $13.8 billion and $18.6 billion respectively. Payments on U.S. intellectual property, at $9.9 billion, hold the third highest. These services export numbers are somewhat distorted by payments between U.S. companies and their affiliates.
The overall trade deficit would likely have exceeded the September number if not for an increase in foreign tourists in December. Travel-related exports, which is where foreign travel to the U.S. gets counted, were $2.7 billion higher in December. The surge in pandemic infections and the end of the holiday season is likely to reverse that in January, which may portend an even larger trade deficit.
The U.S. economy has rebounded more quickly than other countries from the pandemic thanks largely to economic policies put in place during the Trump administration. But the paucity of tariffs on imports means that a significant portion of the increased income of Americans is leaking out to other countries through imports, which subtract from economic growth.
While the Biden administration has kept in place some of the tariffs imposed by Donald Trump, it has stalled or reversed progress on protecting the American economy from mercantilist policies abroad.
Trade deficits tend to push up budget deficits and federal debt because the government typically steps in to make up for the income lost to foreign producers. The alternative is to allow U.S. incomes to fall.