Trade Numbers Suggest 1st Quarter GDP Contraction
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A Commerce Department report out today showed the US trade deficit hitting its highest point in over six years and will likely lead to negative GDP growth in the first quarter. The trade deficit soared 43.1% to $51.4B last month. That was the biggest percentage leap since December 1996 and largest deficit since October 2008. A winter labor strike at West Coast ports helped widen the gab, which gave a licking to the robust dollar. And it will likely lead to a contraction when the Commerce Department releases its revised report on first quarter economic activity. The initial report showed sclerotic 0.2% growth. The surprisingly negative trade data—economists had predicted a jump to $41.2B—should knock at least 0.6% off that number.