US trade deficit rises in fourth quarter of 2017 more than expected

Account balance, according to the IMF is the sum of net exports of goods and services, net primary income, and net secondary income. US economy is based on the deficit. It means that low of goods, services and investments into and out of the country is bigger than the outflowing stream of goods, services, investment etc.

The wider the deficit grows the more money need to be printed, sold in debt obligations and somehow created. It generally is good for the country as it reaffirms the US dollar as a main reserve currency in the World. But the debt growth is good only to some known extent. The debt can grow beyond control and become unserviceable. To prevent such scenario the account balance deficit should not grow too fast.

The main driver of trade deficit in US are imported goods, as for example steel and aluminum, oil and computer hardware. Adjusting trade deficit is in the best interests of current administration. But as for fourth quarter of 2017 the goal is not reached, the data show.

Account balance deficit has risen by $26.7 billion to $128.2 billion. It is 2.6 percent of national economic output. It was widely believed that the deficit will rise to $125B.




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