Trade deficit decreases as exports climb
WASHINGTON — Rising exports and falling imports shrank the United States’ trade deficit in goods and services to the lowest level in nearly a year, data released Thursday by the Commerce Department showed.
The trade deficit — the gap between what the United States imports and what it exports — narrowed to $42.4 billion in August, down $1.2 billion from July. Exports for the month were $195.3 billion, while imports came to $237.7 billion. The nation’s trade deficits with China and the European Union both shrank in August.
Josh Feinman, chief economist of Deutsche Asset Management, said those trends were largely the result of a strengthening global economy that buoyed U.S. exports, as well as the weakening of the value of the dollar.
“Global growth is looking better,” Feinman said. “That does create a little bit of a tailwind for exports.” He cautioned that the economic impact of Hurricane Harvey, which made landfall in Texas on Aug. 25, could be distorting the data somewhat, as ports closed and people stayed home from work and shops.
Despite the narrowing in August, the overall trade deficit is still growing on an annual basis. It was up 8.8 percent in the first eight months from the same period in 2016, according to Commerce Department data.
President Donald Trump has often pointed to the trade deficit as evidence that the U.S. is not benefiting from global trade in the way that it should.
The administration has commissioned a comprehensive report on the state of significant trade deficits, which has not yet been released to the public.
Economists, however, caution against reading too much into the trade deficit as a measure of the administration’s success in giving the United States the economic upper hand.