US Trade Deficit Expands To $101 Billion Despite Bottlenecks

The U.S. trade deficit ballooned in December as import demand increased despite the squeeze on overall trade by ongoing supply chain bottlenecks, the U.S. Commerce Department reported on Wednesday.

The U.S. exported $157.3 billion worth of goods in December, an increase of $2.2 billion from November. At the same time, imports hit $258.3 billion, $5.1 billion more than the amount recorded a month earlier. The overall trade deficit grew 3% to $101 billion.

Supply chain bottlenecks created by the COVID-19 pandemic and the impact it had on transportation and production networks worldwide was a source of pain for the U.S economy in 2021. It has played a central role in driving up inflation as the overall supply of goods has failed to match the explosion of demand that emerged last year.

In December, the Consumer Price Index, a key metric used to gauge inflation, reached 7%. The Producer Price Index for wholesale goods found that prices had risen by 9.7% in 2021.

Despite these trends, Americans' appetite for imported goods has not appeared to wane. The total amount of imports for the first 11 months of 2021 appeared to be higher than all of 2019, according to Axios.