US trade gap widens 7 percent in June as stronger dollar holds back exports, boosts imports

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The U.S. trade deficit increased in June as solid consumer spending pulled in more imports, while the strong dollar restrained exports.

The Commerce Department says the trade gap jumped 7 percent to $43.8 billion in June, up from $40.9 billion in May. Imports increased 1.2 percent to $232.4 billion, while exports edged lower to $188.6 billion from $188.7 billion.

U.S. manufacturers have been held back this year by the strong dollar, which makes their products more expensive overseas.

Exports of large capital equipment, including telecommunications gear and industrial machinery, fell 1.7 percent in June. Imports of food, auto parts, and consumer goods such as pharmaceuticals and cellphones surged as Americans spent more.

Even so, the deficit narrowed in the second quarter compared with the first, boosting the economy.