U.S. Trade Deficit Reaches Two-Year High

The US trade deficit rose to a two-year high in recent months as exports fell and imports rose to a record high. The Commerce Department says the deficit rose to $ 47.2 billion in April, up 6.9 percent from the revised March deficit of $ 44.2 billion.

Exports fell for the fourth straight month of the last five. The drop in exports by 0.2 percent to $ 195.4 billion occurred against the backdrop of an increase in imports by 1.2 percent to a record high of $ 240.6 billion, reflecting the rise in the level of imports of foreign cars, food products, computers, steel products and other goods.

A wider trade deficit can act as resistance to growth because it means that US companies are earning less in overseas markets. But it could also indicate growing demand in the US. Economists believe that the big jump in imports is likely a good sign as the country is recovering from a harsh winter.

In 2013, the trade deficit narrowed by 11.4 percent as a result of the boom in US energy production, which reduced America's dependence on foreign oil, while the increase in oil exports reached record levels.

The widening trade deficit in the first three months of this year compared to the fourth quarter pushed the economy back into negative territory. Gross domestic product fell 1 percent year over year in the first quarter, suggesting a decline in consumer spending.