(CN) – The overall U.S. trade gap grew by 1.5% in March, even though the closely watched deficit with China dropped to a five-year low.
The difference between the number of goods and services the United States sells and buys from other countries increased to $50 billion, compared to $49.3 billion in February. Economists had predicted a trade deficit of about $50.2 billion.
The goods deficit with China dropped to $20.7 billion, a 16.2% decrease from the month before that marks the lowest level since March 2014.
American imports from China fell 6.1% while exports to that country spiked 23.6%, according to a Commerce Department report released Thursday.
President Donald Trump has made closing the trade gap with China a top priority, saying the deficit is the result of bad deals by past administrations.
The year-long trade war with Beijing shows no sign of stopping, as the Trump administration is set to raise tariffs on $200 billion in Chinese products from 10% to 25% on Friday. Negotiators from both countries are still trying to iron out the dispute.
Exports to all countries increased by 1% to $212 billion in March, while overall imports nudged up 1.1%to $262 billion.
While the overall deficit widened in March, it is still below the 10-year high of $59.9 billion in December.
In other economic news, the Labor Department reported Thursday that U.S. wholesale prices edged up 0.2% in April on rising energy costs.
The producer price index, which measures costs before goods reach consumers, increased 2.2% compared with a year earlier, matching 12-month gain seen in March.
Not counting the always volatile food and energy categories, core wholesale prices rose 0.4% last month.
With low inflation pressure, Federal Reserve Chairman Jerome Powell has said the central bank can be “patient” with raising interest rates this year.