Trade Deficit Hits Record $11.5 Billion

The U.S. trade deficit climbed to $11.5 billion, setting a record for the second straight month as plunging exports of commercial aircraft and rising imports of German luxury cars offset improvement in the deficit with Japan.

The Commerce Department reported Wednesday that the July deficit was 1.9 percent higher than a revised June imbalance of $11.28 billion. Both months had represented the highest imbalances since the government began releasing monthly data on goods and services trade in January 1992.

The deficit with Japan declined for a fourth straight month, dropping to $5.12 billion. But for the year as a whole, the trade gap with Japan is running 3.8 percent higher than last year’s record.

The Clinton administration expressed hope that a new Japanese plan for stimulating the economy will do more to shrink what is still the largest imbalance by far.

But private economists held out little hope for any quick improvement in the trade picture, saying the biggest problem is not foreign trade barriers or slow growth overseas but America’s seemingly insatiable appetite for foreign goods.