The U.S. trade deficit unexpectedly dropped to $58.5 billion in April, from $62.4 billion in March, as Americans sharply cut back spending on imports, the Commerce Department reported June 8.
The 6.2% decline in was the steepest since October and surprised analysts, who had forecast on average a deficit of $63.5 billion. The trade deficit narrowed to its lowest level since February.
The shrinking deficit in April was due to a new record level of exports, at $129.5 billion, up 0.2% from the prior month, coupled with a strong 1.9% drop in imports, to $188 billion.
Analysts have forecast for some time that the weak dollar would eventually reduce the trade deficit by making American exports more competitive and imports more expensive for the American consumer.
Highlights of the monthly trade report were record exports in food products, up $724 million, industrial equipment ($368 million) and consumer goods ($141 million).
Meanwhile, Americans curbed their appetite for imported products. Imports of automobiles fell one $1 billion, while consumer goods imports were down $1.5 billion and equipment goods slid $590 million. That restraint more than offset an advance in imported oil prices, which hit $57.28 per barrel, their highest level since September.
Raw materials imports, by contrast, rose by $298 million in April.
Copyright Agence France-Presse, 2007
