WASHINGTON, Oct 4 (AFP): Record oil exports helped shrink the US trade deficit in August, pointing to stronger economic growth in the third quarter, a Commerce Department report showed Friday.
The trade gap fell to $40.1 billion in August from $40.3 billion in July. The July number was revised down slightly from $40.5 billion.
Total August exports increased 0.2 per cent to $198.5 billion, while imports rose 0.1 per cent to $238.6 billion.
Economists on average had forecast the trade gap would swell to $40.9 billion. .
Declining oil imports were a key driver of the smaller shortfall. The petroleum products deficit fell to $13.1 billion, its lowest level since July 2004.
Amid booming US oil production, petroleum product exports surged to a record $14.1 billion, while imports fell 3.9 per cent to $27.2 billion.
The US trade gap has been on a downward trend since June, with the three-month moving average falling to $40.4 billion in August from $41.5 billion the prior month.
Year-over-year, the August trade deficit increased by about $600 million, with exports growing 4.1 per cent and imports up 3.7 per cent.
The goods trade deficit with China, a politically sensitive issue, fell slightly to $30.2 billion from $30.9 billion in July.
President Barack Obama's administration, lawmakers and manufacturers criticise China's currency policy, saying that by keeping the yuan undervalued, the country gains an unfair trade advantage with cheap exports.
The goods gap with the European Union, where the economy has been stuttering, shrank more sharply, to $11.0 billion from $13.2 billion.
Trade, flattered by oil exports, "will make a hefty contribution to Q3 GDP growth," said Ian Shepherdson of Pantheon Macroeconomics
The economist projected net trade would contribute 1.1 percentage point to third-quarter growth, supporting his firm's forecast of an annual rate of 3.5 per cent in the July-September period, after a 4.6 per cent pace in the second quarter.
