WASHINGTON – The nation’s trade deficit shrank by $1.4 billion or 2.4 percent in August to $57.6 billion, the lowest level since January, from July’s revised $59.0 billion, according to a joint report today from the U.S. Census Bureau and U.S. Bureau of Economic Analysis. Compared with August 2006, the trade gap narrowed by $10.0 billion or 14.8 percent.
Analysts had expected the trade gap to narrow to $59.0 billion from the $59.2 billion previously reported for July, according to the median forecast from a Bloomberg News survey of 74 economists. (Their estimates ranged from $57.0 billion to $62.3 billion.)
Total U.S. exports of goods and services rose $0.6 billion over the month to $138.3 billion – the sixth consecutive record – from the July total of $137.7 billion. Goods exports rose $0.3 billion to $99.0 billion in August, led by increases in shipments of industrial supplies and materials ($0.9 billion); foods, feeds, and beverages ($0.6 billion); and consumer goods ($0.2 billion), which more than offset decreases in automotive vehicles, parts, and engines ($1.0 billion); other goods ($0.3 billion); and capital goods ($0.2 billion). Services exports rose $0.3 billion to $39.4 billion as travel costs rose.
Total U.S. imports fell $0.8 billion in August to $195.9 billion, retreating from July’s record $196.7 billion. Goods imports fell $0.8 billion to $165.5 billion, led by decreases in industrial supplies and materials ($0.7 billion); automotive vehicles, parts, and engines ($0.4 billion); and consumer goods ($0.2 billion). Increases were seen in capital goods ($0.3 billion); other goods ($0.1 billion). Imports of services were virtually unchanged at $30.4 billion, the report said.
“Strong global demand is going to be a very important source for U.S. economic growth,” Meny Grauman, an economist at Scotia Capital in Toronto, told Bloomberg News. “We see ongoing strength in exports and ongoing softness on the domestic side.”
The nation’s trade deficit with No. 2 trading partner China shrank to $5.2 billion in August from $6.2 billion in July. The trade surplus with No. 1 trade partner Canada also shrank, to $793 million in August from $800 million in July.
Meanwhile, import prices rose 1.0 percent last month compared with the month before, after falling 0.3 percent in August, the U.S. Department of Labor said in a separate report today. The September rise was led by a 5.4-percent increase in prices for petroleum products.
U.S. export prices also rose in September, climbing 0.3 percent over the month after rising 0.2 percent in August.
Additional information, including the full 47-page U.S. International Trade in Goods and Services news release, is available from the U.S. Commerce Departments’ Census Bureau and Bureau of Economic Analysis at www.bea.gov.
The September 2007 U.S. Import and Export Price Indexes released today by the U.S. Department of Labor are available online at www.bls.gov/mxp .
