The U.S. Bureau of Economic Analysis just announced that the trade deficit for March increased to $48.2 billion.
The federal budget deficit plays a major role in creating U.S. trade deficits. When the government sells Treasury bonds to finance the budget deficit, it competes with U.S. exporters and private borrowers for scarce foreign dollars.
Trade deficits are not necessarily a cause for concern. But in this case, they are a symptom of the real problem: massive government budget deficits.