The US trade deficit in October narrowed by the biggest amount in nearly five years, a Commerce Department report showed today.
The trade gap shrank a surprising 8.4 per cent in October to $58.9 billion from a revised estimate of $64.3 billion in September. Analysts surveyed before the report had expected a much more modest narrowing to about $63.0 billion.
The monthly decline in the trade gap was the biggest since December 2001, when the deficit contracted 11.2 per cent. The monthly trade gap itself was the smallest since August 2005, the last time it totalled less than $60 billion.
US imports fell 2.7 per cent during October, also the largest decline since December 2001, aided by an 11.3 per cent drop in the price of imported oil to $55.47 per barrel. Oil import volumes also fell for a second consecutive month.
The monthly trade gap with members of Opec shrank 18.3 per cent during October to $7.5 billion.
Lower oil imports also more than offset record imports of consumer goods, food, feeds and beverages and of advanced technology products.
The politically sensitive trade deficit with China swelled to a record $24.4 billion in October, as imports from that country surged to $29.3 billion, also a record.
The trade gap with China for the first 10 months of the year totalled $190.6 billion, keeping it on track to easily surpass last year's record of $202 billion.
Overall US exports increased a slight 0.2 per cent in October to a record $123.6 billion, led by records in services, capital goods and consumer goods.
Exports have been aided by a decline in the value of the US dollar, which has made US products more competitive in world markets.