WASHINGTON, Jan 9 (Reuters): The US trade deficit narrowed in November as imports of consumer goods fell to a one-year low amid slowing domestic demand, a trend that, if it persists in December, could result in trade having no impact on economic growth in the fourth quarter.
The report from the Commerce Department on Tuesday also showed exports declined in November amid cooling demand overseas. Demand is slowing both in the United States and abroad following hefty interest rate increases by global central banks since 2022 to tackle rampant inflation.
The Federal Reserve's rate hiking cycle has likely ended, with financial markets expecting the US central bank to start lowering borrowing costs as soon as March.
"The weakness of both exports and imports in November suggests that weaker growth overseas is now being matched by a softening in domestic demand too," said Andrew Hunter, deputy chief US economist at Capital Economics.
The trade deficit contracted 2.0 per cent to $63.2 billion, the Commerce Department's Census Bureau said. Data for October was revised slightly to show the trade gap widening to $64.5 billion instead of the previously reported $64.3 billion.
Economists polled by Reuters had forecast the trade deficit would rise to $65.0 billion in November.
Imports declined 1.9 per cent, or $6.1 billion, to $316.9 billion. Goods imports dropped 2.3 per cent to $257.4 billion.
Imports of consumer goods fell $4.1 billion to the lowest level since November 2022, led by a $1.9 billion decrease in cell phones and other household goods.
US trade deficit narrows as imports decline
FE Team | Published: January 09, 2024 23:19:05
US trade deficit narrows as imports decline
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