The gap between what the U.S. sells to other countries and what it buys from them shrank to $43.6 billion in June, as exports jumped to the highest level since December 2014.
According to a Commerce Department report published Friday, the trade gap decreased 5.9 percent. May’s trade deficit was initially reported $46.5 billion, but it was recently adjusted as $46.4 billion. Analysists had expected the trade gap to shrink to $45 billion in June.
When the figures were matched to inflation. The U.S. trade deficit decreased to $61 billion, which is $1.8 billion lower than the May levels. The decrease is mainly due to a surge in real goods ($126.9 billion) and oil exports.
A couple of weeks ago, the Commerce Department reported that two-tenths of percentage point in the annual economic growth are due to trade in the second quarter.
The report shows that good and service exports jumped 1.2 percent in June, which is the highest level in two and a half years. Food, cars, and capital goods were the most exported items by the U.S. By contrast, China’s exports slipped 4.7 percent during the same time period.
Imports on a Downward Trend
In June, U.S. imports fell 0.2 percent to $238 billion. Americans imported fewer materials and industrial supplies. Imports of smartphones and home appliances also slipped by $0.9 billion. Imports of goods made in China saw an uptick of 1.2 percent, while the trade deficit between the two countries expanded 3.1 percent to hit $32.6 billion in June.
While a shrinking trade deficit may be good news for the U.S.A., we cannot say the same thing about Canada. The Lumberjack Country’s trade deficit widened to $3.6 billion in June. Canadian authorities noted that a sharp decrease in exports while imports kept rising caused the imbalance.
Between April and June, Canadian exports sank 4.3 percent to $46.5 billion, while imports increased 0.3 percent. Many of the good and services Canada is exporting go to the U.S. The two countries currently have a trade surplus of $2.2 billion.
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