US annual trade deficit hits record $418bn

The US trade deficit set a new record today coming in at $489.4bn (€382bn) for 2003, up 17.1% from the previous record of $418bn (€326bn) set in 2002.

Figures released today from the Commerce Department showed that the US trade deficit with China accounted for a quarter of the deficit.

In December alone, the shortfall expanded 10.8% from the previous month.

The US trade deficit with China widened to $9.9bn (€7.74bn) in the month from $9.6bn (€7.5bn) in December last year.

For the full year exports rose 4.6% with record exports of industrial supplies and consumer goods.

Imports rose 8.3% with record imports of food, industrial supplies, autos and consumer goods in 2003.

Separately, consumer sentiment eroded in early February, according to researchers at the University of Michigan.

The consumer sentiment index fell to 93.1 from 103.8 in January.

The drop was worse than expected with economists' forecasts for sentiment to slip to 103.1.

The euro rose as much as 0.6% to $1.2889 on the disappointing data, just below the record $1.29 level struck last month.