Trade of U.S. has gone deficit to more than three-year low

1 Day Ago, Sabine Schuster

The trade deficit has contracted 0.7% through November and is on track to record its first annual decline since 2013. While the shrinking trade bill should provide a boost to gross domestic product in the fourth quarter, falling consumer goods imports also suggest a cooling in domestic demand.

The U.S. trade deficit fell to a more than three-year low in November as imports declined further, likely weighed down by the Trump administration's trade war with China, and exports rebounded, suggesting the economy ended 2019 on solid footing.

The Commerce Department gave statement on Tuesday the trade deficit decreased 8.2% to $43.1 billion, the smallest since October 2016. The percentage drop was the largest since January. Data for October was rere-examined to reveal the trade gap declining to $46.9 billion instead of the previously reported $47.2 billion. Economists polled by Reuters had forecast the trade gap narrowing to $43.8 billion in November.

The goods trade deficit with China, the focus of the White House's "America First" agenda tumbled 15.7% to $26.4 billion, with imports dropping 9.2% and exports jumping 13.7%. The goods trade gap with the European Union fell 20.2% to $13.1 billion.

The United States and China are entangled in a bruising trade war, and Washington has also tussled with other trading partners, including the European Union, Brazil and Argentina, accusing them of devaluing their currencies at the expense of U.S. manufacturers.

Though Washington and Beijing in December extracted out a "Phase 1" trade deal, considerable confusion remains about the details of the agreement. President Donald Trump said last Tuesday that the partial deal would be signed on Jan. 15 at the White House.

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