Skip to main content
Advertising

Originally published January 7, 2014 at 6:41 AM | Page modified January 7, 2014 at 10:56 AM

  • Share:
           
  • Comments (1)
  • Print

US trade deficit declines to $34.3B billion

The U.S. trade deficit fell in November to its lowest level in four years, an encouraging sign that economic growth in the final three months of the year was stronger than analysts had forecast.


AP Economics Writer

Most Popular Comments
Hide / Show comments
Great news! Perhaps now we can focus on raising employee salaries and benefits so that... MORE

advertising

WASHINGTON —

The U.S. trade deficit fell in November to its lowest level in four years, an encouraging sign that economic growth in the final three months of the year was stronger than analysts had forecast.

Gains in energy production and stronger sales of American-made airplanes, autos and machinery lifted exports to an all-time high.

The trade gap dropped 12.9 percent in November to $34.3 billion, the Commerce Department said Tuesday. That's the lowest monthly trade deficit since October 2009.

Exports rose 0.9 percent to a record $194.9 billion. The gain was aided by a 5.6 percent rise in petroleum exports.

Imports dropped 1.4 percent to $229.1 billion. A decrease in demand for foreign oil offset a record level of imported autos.

A smaller trade deficit can boost economic growth. It typically shows that American companies are earning more from sales overseas, while U.S. consumers are buying fewer products from foreign companies.

Economists raised their growth forecasts for the October-December quarter after seeing the November trade report.

Jennifer Lee, senior economist at BMO Capital Markets, noted that the trade gap declined in both October and November. She is currently forecasting growth at an annual rate of 2.4 percent. But after the trade report she said growth could end up being stronger.

Paul Ashworth, chief U.S. economist at Capital Economics, said growth could be 3 percent or higher.

Through 11 months of 2013, the trade deficit is 12.3 percent lower than the same period in 2012. Exports have strengthened, while imports are slightly lower.

A domestic energy boom has boosted exports and lessened America's dependence on foreign oil. U.S. petroleum exports were up 10.8 percent through the first 11 months of 2013 compared with the same period in 2012. In that same period, petroleum imports have fallen 11.5 percent.

The drop in oil imports has been helped by lower global prices. After peaking at $102 per barrel in September, the average price of a barrel of imported crude oil has fallen and averaged $94.69 a barrel in November. Analysts are predicting the price of imported oil will decline further, noting ample supplies and a strengthening dollar

The U.S. deficit with China fell 6.7 percent in November from October to $26.9 billion. U.S. exports to China hit a record. The U.S. deficit with China, the largest with any country, is still on track to set another record this year.

The deficit with the European Union dropped 29.4 percent in November to $10.1 billion. That reflected a big drop in imports from that region, which offset a small dip in U.S. sales to Europe.

The overall economy grew at an annual rate of 4.1 percent in the July-September quarter. Much of that strength reflected a buildup in business stockpiles. Economists believe inventory building slowed in the October-December quarter, which could dampen growth.

Still, other data have been encouraging. The rise in exports has lifted factory output. And a stronger job market has made Americans more confident in the economy and led to more spending. Those factors could offset some of the drag from lower inventory growth.



News where, when and how you want it

Email Icon

Meet the winemakers

Meet the winemakers

View video interviews, conducted by The Seattle Times wine writer Andy Perdue, profiling five of our state's top winemakers.

Advertising

Advertising


Advertising
The Seattle Times

The door is closed, but it's not locked.

Take a minute to subscribe and continue to enjoy The Seattle Times for as little as 99 cents a week.

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Subscriber login ►