Reflecting a notable pullback in the value of exports, the Commerce Department released a report on Tuesday showing that the U.S. trade deficit widened by much more than anticipated in the month of September.
The report said the U.S. trade deficit widened to $43.0 billion in September from a slightly revised $40.0 billion in August.
Economists had expected the deficit to tick up to $40.2 billion from the $40.1 billion originally reported for the previous month.
While the value of imports was nearly unchanged at $238.6 billion, the value of exports fell 1.5 percent to $195.6 billion. The drop in exports came after they reached a record high in August.
The report showed that exports of goods tumbled 1.9 percent to $136.1 billion, while exports of services slid 0.7 percent to $59.5 billion.
Exports of industrial supplies, capital goods and consumer goods saw notable decreases along with exports of travel and transport services.
Rob Carnell, chief international economist at ING, said, "It is possible that the U.S. dollar's strength has already begun to weigh on exports, but in our view, overseas economic weakness is a far more plausible explanation for the export dip."
Meanwhile, the report said a jump in imports of consumer goods offset decreases in imports of industrial supplies, capital goods, and automotive vehicles and parts.
The Commerce Department also said the goods deficit widened to $62.7 billion in September from $60.2 billion in August, while the services surplus narrowed to $19.6 billion from $20.2 billion.
The report also showed that the U.S. trade deficit with China widened to $35.6 billion in September from $30.2 billion in August.
Peter Boockvar, managing director at the Lindsey Group, said, "Bottom line, all else equal, the wider than expected trade deficit may lead to a two tenths cut to Q3 GDP estimates."
"This follows a cut to estimates after the weaker than expected construction spending number yesterday and personal spending on Friday," he added. "We're now looking at a Q3 figure closer to 3% vs. the first print of 3.5%."
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