The U.S. trade deficit rose to a record level in September. While the deficit is too high, it does not reflect problems with the underlying domestic economy.
Imports are strong because U.S. growth and demand are strong and petroleum prices are high.
Export gains are almost as strong, and the 15 percent gain in U.S. goods exports in the third quarter was the fastest quarterly pace in five years. The deterioration in our trade balance from 1999 has centered exclusively on goods, nearly half of it in petroleum and petroleum goods. U.S. imports and exports both grew rapidly in the third quarter. Excluding petroleum and petroleum goods, imports of goods and services rose 15.1 percent from their levels of a year earlier. These strong gains reflect the strength in U.S. domestic spending.