"The goods and services deficit was $109.8 billion in March, up $20.0 billion from $89.8 billion in February, revised," the department said in a statement as it released its monthly data on the US trade balance.
The dollar’s rally to two-year highs has helped fuel American imports as continued disruptions to supply-chain logistics from the coronavirus pandemic prompted domestic manufacturers and businesses to rely more on external sources for their supply of raw materials and other goods. The dollar was up almost 3% on the year as of March, and has continued to rise since to show an annual gain of 8%.
Economists polled by US media had estimated a trade deficit of $107.1 billion on the average for March.
"The good news is the import numbers show the demand in the US is continuing to increase," economist Greg Michalowski said in a post on the ForexLive forum. "Also inventories can be assumed to be replenished which could be a positive for inflation. The supply chain has been a major contributor to inflation. Unclogging it would be a welcome development going forward, as long as demand remains the same or decreases."
According to the Commerce Department, imports rose by $32.9 billion, or 10%, in March to $351.5 billion. Exports, meanwhile, grew by $12.9 billion, or 5.6%, to $241.7 billion.
The net difference between the import and export numbers accounts for the trade deficit.