The trade deficit widened a surprising 18.8 percent in June on a surge of consumer goods from China and other suppliers, suggesting second-quarter economic growth was much weaker than previously thought.
The monthly trade gap totaled $49.9 billion, the highest since October 2008, the Commerce Department reported on Wednesday, as U.S. exports stumbled a bit.
The deficit was wider than any of the 67 Wall Street forecasts collected before the report, and is likely to prompt analysts to ratchet down estimates of second-quarter gross domestic product growth.
The strength in imports, though hinting at some pickup in consumer spending, continues to undermine GDP growth. Moreover, the slowing in exports will only fan fears of a faltering U.S. recovery, said Sal Guatieri, senior economist at BMO Capital Markets.
Many economists have already trimmed their estimates on signs business inventories had risen more slowly than the government first thought. In its first estimate of GDP growth late last month, the Commerce Department had said the economy grew at a 2.4 percent annual rate in the April to June period.
U.S. imports of goods and services grew 3 percent in June to $200.3 billion, the highest since October 2008, in a show of strengthening domestic demand. Imports of consumer goods hit a record $43.1 billion and imports of non-petroleum goods were the highest since August 2008.
Imports from China soared to $32.9 billion, the highest since October 2008.
The closely watched U.S. trade deficit with the East Asian manufacturer widened to $26.2 billion, also the highest since October 2008, while U.S. exports to China fell slightly.
The big jump in the U.S. trade deficit follows Chinese government data on Tuesday that showed China's trade surplus surged to $28.7 billion in July, an 18-month high.
The trade data had little impact on U.S. financial markets. U.S. stock index futures were lower on Wednesday as weak Chinese manufacturing data and a gloomier U.S. economic outlook from the Federal Reserve led to mounting concerns about the health of the global economy.
The dollar hit a 15-year low against the yen.
The trade data is likely to intensify calls in the U.S. Congress for China to move more aggressively to raise the value of its currency against the dollar.
China loosened the yuan from a nearly two-year peg to the dollar in June, but it has barely risen since then. Many lawmakers believe it is undervalued by at least 25 percent.
U.S. imports from Germany and the 27-nation European Union also had their best showing since October 2008.
Overall U.S. exports fell 1.3 percent in June to $150.5 billion, the biggest month-to-month drop since April 2009.
U.S. automotive exports were the highest since October 2008, but other important categories like capital goods, industrial supplies and materials and food, feeds and beverages posted declines.
A second report showed U.S. home loan demand climbed last week but record low mortgage rates failed to light a fire in a market constrained by unemployment and tight lending practices.
Mortgage purchase and refinancing applications rose less than 1 percent in the first week of August, even as 30-year loan rates fell to 4.57 percent, the lowest in 20 years of record keeping by the Mortgage Bankers Association.
(Additional reporting by Emily Kaiser, Editing by Neil Stempleman)