SLUGGISH EXPORTS TIED TO ASIA \ US TRADE DEFICIT WIDENED IN JANUARY

SLUGGISH EXPORTS TIED TO ASIA \ US TRADE DEFICIT WIDENED IN JANUARY

The U.S. trade deficit rose in January amid signs the Asian financial crisis has started to choke exports.

But other signs indicate that the overall vigor of the U.S. economy will help overwhelm these problems.The U.S. goods and services trade deficit with the world rose to $12 billion in January, $1.1 billion more than December. The U.S. goods deficit reached an all-time monthly high of $18.8 billion, also a $1.1 billion rise from the previous month.

That billion-dollar shift from December included by a drop in exports of civilian aircraft, a notoriously volatile item.

U.S. exports of aircraft fell $1.8 billion in January from a record $3.8 billion in December, probably reflecting either delayed delivery of Boeing Co. airliners from November, or early delivery of planes due for shipment in January.

The goods deficit with the newly industrialized countries of Asia surged to $2.19 billion in January from $841 million in December and $783 million in January of 1997. This two billion-dollar imbalance compares with a $7.8 billion deficit with these countries for all of 1997, and is the clearest sign yet that the Asian crisis is affecting the U.S. economy.

Currency devaluations and slowing growth in Thailand, South Korea, Indonesia and other fast-growing economies in East Asia are expected to reduce U.S. exports and increase the volume of imports from the region. In January, exports to these countries dropped to $4.9 billion from $6.7 billion in December and from $6 billion in January 1997.

Exports fell sharply to South Korea, the United States' fifth-largest market and one of the hardest-hit by the crisis, but dropped by just as much to Taiwan, which has been thought to have escaped the worst of the turmoil.

Exports to South Korea fell from $1.7 billion in December to $1.1 billion in January, while shipments to Taiwan fell from $2.2 billion in December to $1.7 billion in January.

Economists predict that recession in Asia will hurt U.S. exports enough to shave anywhere from one-half to one full percentage point off U.S. growth in 1998, which was otherwise expected to be 2.5 percent to 3 percent.

But the trade results for January show that even a steep increase in the trade deficits with the afflicted countries can easily be overwhelmed by improvement elsewhere.

In January, for example, the $1.2 billion increase in the trade deficits with the newly industrialized countries of East Asia was offset by a $900 million decrease in the deficit with Japan and a similarly sized drop in the deficit with the European Union.

Overall imports of goods and services from the rest of the world dropped $89.3 billion in January from a record monthly tally of $90.2 billion in December. Imports from East Asia's newly industrialized countries followed this trend, falling to $7.1 billion in January from $7.5 billion the month before.

A drop in the prices of imports from most of East Asia in the second-half of 1997 is expected to keep a lid on the value of imports from the region. while the volume of those shipments will rise, said Jeff Schott, an economist with the Institute for International Economics.

''Most of the impact (from the crisis) is expected to show up on the export side, and that seems to be reflected here,'' he said.

The moderation in imports was driven by a drop in crude oil prices and an apparent decrease in the volume of imports, reflecting lower demand from one of the warmest winters on record. Energy prices fell 2.4 percent in January and another 2.2 percent in February.

Overall inflation, measured by the Consumer Price Index, was virtually zero in January and only 0.1 percent in February. Lower energy prices are expected to help keep inflation at very low levels and help stimulate demand and consumer spending in the United States that is due to suffer from the Asia crisis.

The U.S. goods trade deficit with China increased to $4.2 billion in January from $3.8 billion in December and only $2.6 billion last January. China has not devalued its currency, but has seen a slowing of its usually brisk economic growth due to a loss of exports to its East Asia neighbors.

Some analysts fear that a loss of export markets in Asia will encourage China to dump its goods in the United States. China's deficit in January fell $100 million short of the imbalance with Japan.

Some have predicted that China's deficit would overtake Japan's in 1998, but devaluation and stagnant growth in Japan could lead to that country pulling ahead again.