Washington, May 17 (Bloomberg) -- The U.S. trade deficit probably grew in March to its widest in a year as the price of imported oil rose and a recovering economy boosted demand for goods, according to economists in a Bloomberg News survey. A $32.5 billion excess of goods and services imports over exports is likely for the month, compared with $31.5 billion in February, based on the median of 59 forecasts in the survey. That would be the largest since March 2001, at the start of recession. Exports probably rose more slowly than imports. ``While it might just be higher oil prices that are taking imports higher, we have been seeing imports in general move up recently, and that's a reflection of the improvement in the U.S. economy,'' said Michael Moran, chief economist at Daiwa Securities America Inc. in New York. Magna International Inc., an auto parts maker in Canada, is among companies benefiting as U.S. consumers keep spending. While a wider trade gap subtracts from U.S. gross domestic product, increased imports also reflect the strength of the U.S. economy, which is pulling other nations out of a global slump. The U.S. Commerce Department releases the report today at 8:30 a.m. Washington time. Economists watch it not only to gauge U.S. and overseas demand, but also to calculate gross domestic product. Imports are subtracted because they presumably replace U.S.-made goods, while exports add to growth estimates. Also today, at about 10 a.m. Washington time, a report from the University of Michigan is likely to show that consumer confidence in the economy was unchanged in May. The university's consumer sentiment index will probably come in at 93 for May, the same as the previous month, economists said. Since the Sept. 11 attacks, the index has fallen as low as 81.8 for September and risen as high as 95.7 during March. In May 2001, it was 92. In May 2000, the Michigan index registered 110.7.

Oil Prices
A wider deficit is expected for March because the price of crude oil averaged $24.31 a barrel on the New York Mercantile Exchange during the month, up from $20.69 a month earlier. Prices have since risen further, with the June contract reaching an eight- month high of $29.36 a barrel this week. Production cuts by Arab countries have helped send oil prices up. At the same time, the strength of U.S. demand for automobiles has increased the volume of imports from Mexico. Autos sold at a 17.3 million-unit annual pace in April, the fastest in five months, as incentives lured buyers. Mexico's maquiladoras, factories near the U.S. border where duty-free imported parts are assembled into products sold abroad, make many of the cars and light trucks sold in the U.S. Foreign demand is also rising, partly because maquiladoras rely on U.S.-produced parts. Overseas sales of other goods may nonetheless be restrained as economies elsewhere recover more slowly than in the U.S.

Gillette, Hewlett-Packard
Gillette Co., the world's largest maker of razors, sold fewer goods in Latin America in the first quarter than a year earlier due to a recession in Argentina. Hewlett-Packard Co. said overseas sales fell 4 percent during the quarter that ended April 30 compared with a year earlier. Sales to the Asia-Pacific region fell 13 percent. They fell 12 percent in Latin America. Some economists say that a widening trade deficit may pose a threat to the U.S. ``When you have to attract capital into this country to fund a deficit, it means you have to pay higher interest rates than you would normally, and there's always a danger that foreign investors will stop being attracted to your country and you can face a serious capital shortage,'' said John Vail, chief strategist at Mizuho Securities USA Inc.