Balance Of Trade

America's trade deficit rose to its second-highest level of the year as the price of imported crude oil jumped and demand for Chinese products remained strong despite recalls of tainted products. A separate weekly report showed the number of Americans applying for first-time jobless benefits fell more than expected, suggesting continued labor market strength. Mortgage foreclosures in the U.S.

China's trade surplus soared again in May, reaching the third-highest monthly level on record, according to government figures released Monday. The surplus hit $22.5 billion, up 73% from a year earlier, China's customs agency said. Exports jumped 28.7% to $94 billion, and imports rose 19.1% to $71.6 billion. China has promised to narrow its trade gap under pressure from Washington and other governments, but economists say multibillion-dollar surpluses are likely to continue.

The U.S. trade deficit shrank much more than expected in April, raising hopes for stronger economic growth as the weakening dollar helped trim imports and boost exports to a record. The trade gap narrowed 6.2% to $58.5 billion from a downwardly revised estimate for March, the Commerce Department reported Friday, adding to signs that U.S. economic growth could top 3% or even 4% in the second quarter.

President Bush said he told a senior Chinese economic minister Thursday that the U.S. was "watching very carefully" whether Beijing would strengthen the value of its currency. After a meeting with Vice Premier Wu Yi, leader of the largest high-level Chinese delegation ever to visit the United States, Bush told reporters the U.S. was "making it clear to China that we value our relationship, but the $233-billion trade deficit must be addressed."

The Bush administration pushed for concrete results in high-level trade talks with China that began Tuesday, but the head of the Chinese delegation bluntly warned against confrontation. Treasury Secretary Henry M. Paulson Jr. said it was important that the two days of talks produce results to build trust between the countries. He said Americans were by nature impatient, and he said the two sides should work to build a "road map to the future."

China took steps Friday to let its currency trade more freely against the dollar and to cool its sizzling economy ahead of talks in Washington over Beijing's soaring trade surplus. China eased controls on the yuan amid pressure from the U.S. and Europe, but cautioned against expecting sharp increases in its value. The U.S. responded that Beijing was not moving fast enough to allow its currency to strengthen and help reduce its growing trade gap.

Higher oil prices and imports in March pushed the U.S. trade deficit to its widest level in six months, according to a government report Thursday that suggested weaker U.S. economic growth. The trade gap grew more than 10% in March from the previous month to $63.9 billion as U.S. oil imports reached their highest level since August and the average price for imported oil rose to $53 a barrel from $50.71 in February, the Commerce Department said in a report.

A delegation of Chinese business leaders committed to buying $4.3 billion in U.S. technology, hoping to soften a political backlash to the massive trade imbalance dividing two of the world's economic powers. The agreements were trumpeted at a ceremony staged two weeks before the scheduled start of government talks in Washington, where leaders will try to tackle the United States' $232-billion trade deficit with China and other prickly issues. Gov.

Democrats in Congress have been pushing an ambitious trade agenda, promising to assist displaced American workers and reduce the trade deficit. Now they're taking on the global currency market -- vowing to pass legislation to punish China and other Asian countries for undervaluing their currencies. The unusual move by Congress to meddle in foreign exchange markets is bound to please labor unions, manufacturers and other businesses that are struggling in the global economy.