The US trade deficit swelled in December to $40.6 billion, from $38.3 billion the previous month.

The rise was attributed to higher prices for imported oil, the Commerce Department reported today.

Imports surged at the fastest rate since June, rising by 2.6% $203.5 billion exceeding the $200 billion threshold for the first time since that month.

Exports also rose, by 1.8% to $163 billion on a monthly basis boosted by overseas demand for US industrial supplies and capital goods.

Meanwhile, for the 2010 year, the trade deficit grew at the fastest rate since 2000, hitting $497.8 billion 32.8% higher than 2009 levels.

However, the politically sensitive trade deficit with China grew by 20.4% to a record high of $273.1 billion.

The figures will add fuel to the US’s argument that China keeps the value of the yuan low to help its exporters at the expense of overseas competitors.

Trade groups have argued that the yuan, also referred to as the renminbi, is kept up to 40% below what its value should be against the US dollar.

Many have previously referred to China as a currency manipulator.

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