The US trade deficit unexpectedly narrowed in August as exports posted a small gain and imports fell on a big drop in demand for foreign oil. The Commerce Department reported that the trade deficit declined 3.5% to $30.7 billion. Oil prices did rise but the volume of shipments dropped sharply in August.
The deficit decreased from $31.9 billion (revised) in July to $30.7 billion in August, as exports increased and imports decreased. The previously published July deficit was $32.0 billion.
- Exports of goods and services increased $0.2 billion in August to $128.2 billion, mostly reflecting an increase in services exports. Goods exports increased slightly.
- The increase in goods exports was mostly accounted for by increases in industrial supplies and materials and automotive vehicles, parts, and engines. A decrease in capital goods was mostly offsetting.
- The increase in services exports was more than accounted for by increases in travel, other transportation (which includes freight and port services), and other private services (which includes items such as business, professional, and technical services, insurance services, and financial services). A decrease in transfers under U.S. military sales contracts was partly offsetting.
- Imports of goods and services decreased $0.9 billion in August to $158.9 billion, mostly reflecting a decrease in goods imports. Services imports also decreased.
- The decrease in goods imports was more than accounted for by decreases in industrial supplies and materials and consumer goods. An increase in automotive vehicles, parts, and engines was partly offsetting.
- The decrease in services imports was more than accounted for by a decrease in other transportation. An increase in travel was partly offsetting.
Goods by geographic area (not seasonally adjusted)
- The goods deficit with Canada decreased from $2.1 billion in July to $1.5 billion in August. Exports increased $1.2 billion to $17.7 billion, while imports increased $0.6 billion to $19.2 billion.
- The goods deficit with China decreased from $20.4 billion in July to $20.2 billion in August. Exports increased $0.3 billion to $5.6 billion, while imports increased $0.1 billion to $25.8 billion.
- The goods deficit with the European Union decreased from $8.0 billion in July to $5.4 billion in August. Exports decreased $0.4 billion to $16.7 billion, while imports decreased $2.9 billion to $22.1 billion.