Cleveland Fed says US trade gap may hit growth

The massive trade deficit in the United States will eventually be reversed and implies a weaker dollar and higher interest rates, a Cleveland Fed report said, warning this could quell growth unless US exports grow.

The Cleveland Federal Reserve, writing in the January edition of its regular publication on the economy, noted that the country's trade gap had spiraled above 5 percent of gross domestic product and foreign claims on U.S. assets stood at 20 percent of GDP.

"Should these trends conti