US Trade Deficit at 13-Month Low

The US trade gap narrowed to USD 40.44 billion in March of 2016 from a downwardly revised USD 46.96 billion deficit in the previous month and below market expectations of USD 41.5 billion. It is the smallest gap since February last year as imports hit a 5-year low. Purchases of industrial supplies and materials fell to its smallest since April 2004 and imports of petroleum were the lowest since September 2002.

The narrowing March deficit reflected a decrease in the goods deficit of $6.0 billion to $58.5 billion and an increase in the services surplus of $0.5 billion to $18.1 billion.

Total imports shrank 3.6 percent to $217.1 billion, the lowest figure since February of 2011. Imports of goods decreased $7.9 billion to $175.3 billion: consumer goods fell $5.1 billion; toys, games, and sporting goods went down $1.1 billion; other textile apparel and household goods declined $0.6 billion; cotton apparel and household goods fell $0.6 billion; capital goods dropped $1.6 billion and computer accessories decreased $0.8 billion. Imports of services decreased $0.2 billion to $41.7 billion: transport, which includes freight and port services and passenger fares, fell $0.4 billion.

Total exports went down 0.87 percent to $176.6 billion. Exports of goods decreased $1.8 billion to $116.8 billion: consumer goods fell $1.6 billion; pharmaceutical preparations declined $0.8 billion; gem diamonds dropped $0.7 billion; industrial supplies and materials decreased $0.8 billion; other petroleum products declined $0.5 billion while capital goods increased $1.0 billion and civilian aircraft rose $1.3 billion. Exports of services increased $0.3 billion to $59.8 billion: travel (for all purposes including education) went up $0.2 billion.

Considering the first quarter of the year, the average trade deficit narrowed by $1.4 billion, with imports falling more than exports (down by $2.6 billion and $1.2 billion respectively), suggesting the drag from external trade on GDP may be smaller than expected. 

US Trade Deficit at 13-Month Low

BEA | Joana Taborda |
5/4/2016 2:02:23 PM