U.S. Goods Trade Deficit
Declines to Smallest in Three Years, By Jeff Kearns,
12/30/19.
The U.S. merchandise-trade deficit unexpectedly
narrowed for a third month in November to the smallest shortfall in three years
as exports increased and imports declined, the latest sign that economic growth
is holding up at the end of the year.
The gap
decreased to $63.2 billion from $66.8 billion the prior month, according to Commerce Department data released
Monday that compared with forecasts for a widening to $68.7 billion. Exports rose 0.7% while imports dropped 1.3%.
The further narrowing of the trade
deficit will help give a boost to growth in the fourth quarter. Imports were a
slight drag on gross domestic product growth in the two prior periods, while
exports of goods provided a slight tailwind in the third quarter after weighing
in the prior three-month period.
The report comes after the U.S. and
China agreed this
month to the first phase of a trade agreement in which Washington will ease
tariffs, and at least temporarily calm fears of an escalating trade war between
the world’s two largest economies. Chinese Vice Premier Liu He is set to lead a
delegation to Washington Saturday to sign the deal, the South China Morning
Post reported Monday.
Exports got a boost from a 3.4%
increase for automotive products and 2.6% gain for consumer goods, while
imports decreased across industrial supplies, consumer products and capital
goods.
The report also showed retail
inventories dropped 0.7% in the month as wholesale inventories were little
changed. Analysts look to these numbers to adjust estimates for economic growth
during the quarter.
Exports and imports of goods
account for about three-fourths of America’s total trade; the U.S. typically
runs a deficit in merchandise and a surplus in services.
Monday’s figures cover goods only.
Commerce will release full international trade data on Jan. 7, including
services and more details on merchandise shipments.
—
With assistance by Chris Middleton
Norb
Leahy, Dunwoody GA Tea Party Leader
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