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Trade gap largest since 2012

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Stronger dollar and softening demand overseas hurts exports.

The Commerce Department reported Thursday that the Q4 international trade deficit increased by 14.7% compared to the prior quarter, coming in at $113.5 billion. This represented the largest gap since Q2 of 2012.

The deficit increased to 2.6% of GDP from 2.2% in the third quarter, which was the largest percentage gap since the fourth quarter of 2012. The increase in the current-account deficit was primarily accounted for by a decrease in the surplus on primary income. In addition, the deficits on goods and secondary income increased. These changes were partly offset by an increase in the surplus on services.

Analysts had expected a deficit of $103.2 billion.

The Q4 deficit on goods and services increased to $127.0 billion in the fourth quarter from $123.9 billion in the third quarter.

For the full year 2014, the U.S. current-account deficit increased to $410.6 billion from $400.3 billion in 2013. The deficit was 2.4% of current-dollar GDP in both 2014 and 2013. 

For the full report, click here.

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