Rising exports and falling imports pushed the U.S. trade deficit in August to the lowest level in five months, according to government data released on Tuesday.
The overall trade gap in the world’s largest economy was $70.4 billion, the Commerce Department said, up from a revised $78.9 billion in July.
That was less than analysts expected and the lowest since March.
Exports rose 2.0 percent to $271.8 billion, helped by goods such as aircraft and telecommunications equipment, along with pharmaceuticals and automobiles.
But semiconductor exports fell in the month.
Total imports fell 0.9 percent to $342.2 billion, driven by declines in industrial supplies and passenger cars.
U.S. hiring soars above past expectations in sign of resilient market
While there may have been an increase in imports of consumer goods as companies prepare for possible disruptions from a dockers’ strike, thousands of workers returned to work after a three-day strike last week.
Negotiations between shipping companies and an ocean liner union will be allowed to continue until January 15.
With the central bank’s sharp rate cut in September, the US economy could also get a bit of a boost in the coming months.
The goods deficit with China — a point of contention during the trade war between the United States and China — narrowed by $2.6 billion to $24.7 billion in August, Commerce Department data showed.
This was as imports fell in August while exports rose.
“Putting together the July and August data suggests that net trade is flat so far in the third quarter, without making any significant additions or subtractions to GDP growth so far,” said economists Carl Weinberg and Rubeela Farooqi of High Frequency Economics.
Source: AFP