The United States trade deficit continued to narrow in October, reaching its lowest level since June 2009, under the combined effect of an increase in exports and a drop in imports, according to data released Thursday by the Commerce Department.
In October, the trade balance of goods and services saw its deficit settle at 29.4 billion dollars, falling back below the 30 billion mark for the first time in more than fifteen years, a fall of 39% compared to the previous month, itself already penalized by a sharp decline.
It is also significantly better than anticipated by analysts, who instead expected the deficit to widen to $58.4 billion, according to the consensus published by MarketWatch.
Above all, the decline in the deficit has been confirmed for three months while economists continue to anticipate a reverse movement which is currently slow to materialize.
The data was initially scheduled for publication earlier, but was ultimately delayed by nearly a month due to the record budgetary shutdown that paralyzed the US administration for 43 days.
In detail, exports for the month of October increased by 2.6% compared to the previous month, already marked by a strong increase, i.e. an additional 7.8 billion dollars, while imports fell by 3.2%, i.e. a drop of 19.2 billion dollars, almost entirely concentrated on goods.
The increase in exports is particularly driven by raw materials, non-monetary gold and other precious metals, while consumer products and other goods are in decline. On the services side, travel and intellectual property were the main drivers.
The fall in imports is caused in particular by a sharp drop in pharmaceutical products, which accounts for almost 80% of the drop ($14.3 billion less), while IT and telecom equipment are on the rise. For services, imports are up slightly, again driven by tourism.
Concerning the geographical distribution, the month of October represents a strong change in the trade deficit in goods, with China now only the fourth largest deficit over a month for the United States, with 13.7 billion dollars.
Mexico, Taiwan and Vietnam are now the countries with which the United States has the largest trade deficits, increasing in all three cases.
Conversely, the trade deficit with the European Union (EU) fell sharply over one month, to just $6.3 billion, focusing in particular on Germany, Ireland and France. Conversely, the United States generates a trade surplus with the Benelux countries within the EU and with Switzerland, the United Kingdom, Brazil and Australia outside the EU.
