WASHINGTON (dpa-AFX) - Primarily reflecting a notable decrease in the value of imports, the Commerce Department released a report on Thursday showing the U.S. trade deficit narrowed in the month of October.
The Commerce Department said the trade deficit narrowed to $47.2 billion in October from a revised $51.1 billion in September.
Economists had expected the trade deficit to narrow to $48.7 billion from the $52.5 billion originally reported for the previous month.
The narrower trade deficit in October reflected the smallest trade deficit since the $44.4 billion shortfall in May of 2018.
The deficit shrank as the value of imports tumbled by 1.7 percent to $254.3 billion in October after plunging by 1.6 percent to $258.7 billion in September. The value of imports fell to its lowest level since November of 2017.
A sharp drop in imports of consumer goods led the decrease in the value of imports, while imports of automotive vehicles, parts and engines also fell amid the strike at General Motors (GM).
Meanwhile, the report said the value of exports edged down by 0.2 percent to $207.1 billion in October after slumping by 0.9 percent to $207.6 billion in September.
Decreases in exports of drugs, diamonds, civilian aircraft engines and automotive vehicles and parts were partly offset by an increase in exports of industrial supplies and materials.
The Commerce Department noted the goods trade deficit narrowed to $68.0 billion in October from $71.7 billion in September, while the services trade surplus inched up to $20.8 billion from $20.6 billion.
'In real terms, goods exports fell by a larger 0.5% m/m and goods imports declined by 2.0% m/m,' said Michael Pearce, Senior U.S. Economist at Capital Economics. 'Even assuming some recovery in the latter, imports are on track to fall by close to 5% annualized in the fourth quarter while exports look set to decline by 1% annualized.'
He added, 'That would mean net trade added 0.7%-pts to GDP growth in the fourth quarter, which we expect will be 1.5% annualized.'
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