President Donald Trump's ongoing effort to rewrite America's role in several long-standing trade agreements appears to have done little to rein in the country's ballooning trade deficit a year ago, as America's goods imbalance clocked in at a record $891.2 billion.
The U.S. Commerce Department issued its final report Wednesday on the trade gap for 2018.
The US merchandise trade deficit increased by $83.8 billion, or 10.4 percent, to $891.3 billion in the past year, the Commerce Department said.
While Trump sees the trade deficit as a sort of economic score card for which country is on top, most economists disagree with this perspective, viewing trade deficits as a sign of neither economic strength nor weakness, but a function of macroeconomic factors like investment flows, fluctuations in the value of currency and relative growth rates.
Economists say the trade deficit is swelling because of broad economic forces, including a chronic shortfall in national savings that was exacerbated by last year's US$1.5 trillion corporate and personal income tax cut.
President Donald Trump's attempt at reducing America's trade deficit with foreign countries seems to have done exactly the opposite.
Economists broadly agree that the trade deficit isn't a particularly accurate indicator of economic health - and, in fact, many have argued that the deficit climbed in part a year ago because the USA performed so admirably in the face of global economic malaise.
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The dollar is now valued 19 per cent above its 10-year average against the currencies of major USA trading partners, according to Federal Reserve data.
The deficit, which is the difference between the goods and services the USA buys from other countries and those it sells to them, rose to a seasonally adjusted $59.8 billion in December - an increase of nearly 19 percent.
While goods exports hit a record $1.7 trillion in 2018, they declined in the last three months of the year, weighed by the U.S. The Trump administration wants to be able to impose tariffs on China if it violated its promises in any future pact - without retaliation.
Economists don't like to dwell too much on the United States trade balance. Trump is trying to reach a new trade deal with China and hopes to strike an agreement with President Xi Jinping in the coming weeks, but the stakes could not be higher.
And as economists predicted, several recent studies found that the total amount of money raised from increased tariffs came from US businesses and citizens.
Following a spat between the USA and the EU when America lifted tariffs on steel and aluminium, Mr Trump and European Commission President Jean-Claude Juncker a year ago reached a truce.
"China's concessions probably won't be very big because a lot of their demands are what we already plan to reform", former finance minister Lou Jiwei said in Beijing on Wednesday, calling some USA demands for change 'unreasonable'.
A study by economists at the New York Federal Reserve, Columbia University and Princeton University found that the trade war is costing consumers and companies $3 billion per month in added tax costs.