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Wednesday, 19 September, 2001, 14:29 GMT 15:29 UK
US exports slump
A Boeing test center building in Seattle
The world is no longer so keen on US aircraft
US exports in July took their biggest monthly dive in a decade, indicating that America's economy was slowing sharply well before last week's attacks.

The 2.5% month-on-month export drop, combined with a 2.1% slowing in imports, pushed the US trade deficit to $28.8bn.

America's persistently huge trade deficit has long been one of its most pressing economic problems.

And as the country's industry takes a knock from the effects of the terrorist attacks, the export slump is only likely to worsen.

Deep-seated problems

The release of already-outmoded figures may no longer have the same effect on Wall Street as under normal circumstances.

But the figures show that the US's economic problems do not stem wholly from the attacks.

American export-oriented firms have found it increasingly hard to compete in recent years, battered by price competition from firms based in developing countries, and the global slowdown in demand for technology.

The worst-performing export sector was the ailing aviation business.

Exports of civilian aircraft - almost all produced by Boeing - plummeted by 5.8% on the month.

Demand down

Demand within the US is also plainly weak.

Imports of "capital goods" - the technology and equipment used by firms in their production - slumped by 3.1% month on month in July, far outpacing the overall decline in imports.

The worst-hit markets were semiconductors, computer accessories and other electronic products.

This will be viewed by analysts as especially worrying, as US import demand fuels economic activity around the world, especially in the tech-dependent producing countries of Asia.


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See also:

17 Sep 01 | Business
Economy in the balance
13 Sep 01 | Business
Will US consumer confidence fade?
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