Jun 3, 2016 2 min read

WASHINGTON – The U.S. trade deficit, after falling to the lowest point in more than two years, increased in April as a surge in imported goods outpaced a rebound in exports.

The Commerce Department said Friday the deficit increased 5.3 percent in April to $37.4 billion, up from an imbalance of $35.5 billion in March. Exports increased 1.5 percent to $182.8 billion but imports rose faster, increasing 2.1 percent to $220.2 billion.

The politically sensitive deficit with China surged 16.3 percent to $24.3 billion, a development certain to heighten trade tensions between the world’s two largest economies.

So far this year, the deficit is running 4.8 percent below the pace set a year ago with a fall in imports offsetting further weakness in U.S. exports, which were hurt by a slowdown in global growth.

U.S. export sales were hurt by a strong dollar which makes American products more expensive on overseas markets. However, the dollar weakened a bit since peaking earlier this year. If that trend continues, it could help export sales going forward.

The deficit for all of 2015 totaled $500.4 billion, up 2.1 percent from the previous year. The higher deficit subtracted 0.6 percentage point from overall growth in a year when the economy, as measured by the gross domestic product, expanded by a modest 2.4 percent.

America’s perennial trade deficits were a topic in this year’s election campaigns with presumptive Republican presidential nominee Donald Trump attacking the Obama administration for failing to protect American workers from unfair foreign competition.

Trump accused China and other nations of pursuing policies that cost millions of American jobs. As president, Trump said he would seek to impose a 45 percent tariff on Chinese goods to try to halt the objectionable practices.

United States and Chinese officials will meet next week in Beijing for annual talks between the two nations aimed at resolving disagreements between the two nations in the areas of trade and foreign policy. Treasury Secretary Jacob Lew, leading the economic talks, said China could suffer bad consequences for its economy if it backs away from its program to open its markets and reduce its reliance on export-led growth.

The big increase in the U.S. deficit with China in April reflected a surge in shipments of Chinese goods after they were curtailed in March, a drop that reflected disruptions caused by the China’s Lunar New Year holiday.