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The US goods trade deficit has widened to the highest level ever recorded, just as trade tensions between the US and China escalate.

The US goods deficit, the difference in exports and imports, widened to $76.04bn in September from $75.46bn in August, barely surpassing the July 2008 record of $76.03bn, according to data released on Thursday by the US Census Bureau. The 0.8 per cent month on month increase was the fourth increase in as many periods

US exports jumped 1.8 per cent on a month-over-month basis, but imports rose 1.5 per cent.

The widening gap by sharpen questions about the effectiveness of President Donald Trump’s hallmark trade initiatives. His administration has taken action against several countries, including China, for what he has called unfair practices. Some of the measures have drawn counter-action — as has been the case with China.

A separate report from the US Commerce Department released on Thursday also showed that durable goods orders in the US rose by 0.8 per cent in September propped up by a spike in demand of defence aircraft and parts, which jumped 119 per cent.

The figures were better than the 1 per cent decline expected by a group of economists polled by Reuters, but they also represent a sharp slowdown from a 4.6 per cent jump in August.

Excluding the volatile transportation component, orders rose by a more modest 0.1 per cent.

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