US trade deficit swells to $42.3bn

The US trade deficit increased sharply in February as imports rose and exports fell amid signs of slowing growth in China and Europe's tepid recovery, official data showed Thursday. The nation's trade gap in goods and services with the rest of the world widened to $42.3 billion, from an upwardly revised $39.3 billion in January, the Commerce Department said. The shortfall has increased for three months in a row. Analysts on average had expected a smaller increase to $39.3 billion. The January trade deficit was previously reported at $39.1 billion. In February, imports increased by $1.0 billion from January to $232.7 billion. The increase was led by imports of services, including payments for the rights to broadcast the 2014 Winter Olympics Games. Exports fell by $2.0 billion to $190.4 billion, mostly due to a fall in goods exports, including industrial supplies and capital goods. "The February trade data reinforce our view of a gradual recovery in the US," said Tu Packard of Moody's Analytics. Packard said the decline in February's goods exports would likely be temporary. "It does not mean that the global economic recovery has faltered."