WASHINGTON: The US trade deficit narrowed less than expected in October as lower crude oil prices failed to offset a jump in imports, while an increase in exports suggested the economy was weathering faltering global demand.
The Commerce Department said the trade gap fell 0.4 percent to $43.4bn. September’s shortfall on the trade balance was revised up to $43.6bn from a previously reported $43.03bn.
Economists polled had forecast the trade deficit falling to $41.4bn. When adjusted for inflation, the deficit was little changed at $50.84bn, suggesting trade would be a drag on fourth-quarter gross domestic product. Trade was one of the contributors to the third quarter’s brisk 3.9 percent annualised growth pace.
Imports increased 0.9 percent in October to a record high of $241bn. Petroleum imports were the lowest since November of 2009. A domestic energy boom has enabled the United States to reduce its dependence on foreign oil, easing pressure on the trade deficit.
Declining oil prices, which fell in October to their lowest level since February of 2011, are also helping to curb the import bill.
While a slowing global economy is dampening crude oil prices, there is little sign that US exports are taking strain. Exports increased 1.2 percent to $197.5bn in October.
Exports to the European Union increased 8.5 percent, while China saw a 36 percent jump in the value of goods it imported from the United States. Reuters
