The US trade deficit narrowed more than forecast in March as imports dropped by the most in more than six years, reflecting the economic slowdown.
The gap shrank to $58.2 billion, the lowest this year, from a revised $61.7 billion in February, the Commerce Department said today in Washington. The shortfall with China was the smallest in two years.
Americans bought fewer automobiles and less crude oil, furniture and communications equipment from overseas as the economy grew at the slowest pace since 2001. Exports fell for the first time in more than a year, indicating economies abroad may also be starting to cool.
The dollar, which fell earlier today, remained lower after the figures. The US currency was at $1.5448 per euro at 8.34am in New York, from $1.5393 late yesterday.
After eliminating the influence of prices, which are the numbers used to calculate gross domestic product, the trade deficit shrank to $47.2 billion, the lowest since November 2003, from $50.9 billion.
Imports decreased 2.9 percent, the most since December 2001, to $206.7 billion. Purchases of crude oil dropped, even as the average price for the month jumped to a record $89.85. The quantity of petroleum bought from overseas was the lowest since
February 2007.
The trade gap may not be able to keep narrowing as oil prices continue to surge. Crude oil prices jumped to over $125 a barrel today, the highest ever.
Demand for goods from China suffered the biggest slump last month, helping to narrow the trade gap with that nation to $16.1 billion, the smallest in two years. At the same time, exports to China were the second-highest ever.
Bloomberg