The U.S. trade deficit shrank a bit in September, helped in part by lower oil prices.
The Commerce Department said Thursday that the goods and services deficit for September came in at $64.3 billion, less than the revised figure of $69 billion for August and smaller than what economists had been projecting.
The U.S. deficit with China rose to a new record of $23 billion in September, and stands at $166 billion for the year.
The government said total September exports were $123.2 billion, while impoprts came in at $187.5 billion. September exports were $0.6 billion more than August exports of $122.6 billion, and September imports were $4.1 billion less than August imports of $191.6 billion.
In September, the goods deficit decreased $4.8 billion from August to $70.1 billion, and the services surplus decreased $0.1 billion to $5.8 billion. Exports of goods increased $0.6 billion to $88.6 billion, and imports of goods decreased $4.2 billion to $158.7 billion.
Commerce said the August to September change in exports of goods reflected increases in industrial supplies and materials ($1.0 billion); capital goods ($0.7 billion); and other goods ($0.3 billion). Decreases were seen in automotive vehicles, parts, and engines ($0.7 billion); consumer goods ($0.4 billion); and foods, feeds, and beverages ($0.3 billion).
The August to September change in imports of goods reflected decreases in industrial supplies and materials ($3.6 billion); capital goods ($0.6 billion); automotive vehicles, parts, and engines ($0.4 billion); and foods, feeds, and beverages ($0.1 billion). An increase occurred in consumer goods ($0.6 billion). Other goods were unchanged.
“Exchange rates seem to be working,” said Frank Vargo, the National Association of Manufacturers’ vice president of international economic affairs. “The deficit with the European Union (EU) shrunk to an annual rate of $100 billion in September, an improvement of close to $40 billion from the year-ago figure. The rather spectacular shift with Europe is evident in that, at an annual rate, U.S. exports to the EU are up $47 billion in the last year, while imports from the EU are up only $8 billion.” (These figures are for all merchandise trade with the EU, because detailed manufactured goods data for individual countries are not available yet.)Vargo said that, on a seasonally-adjusted annual rate, the deficit with China stood at $238 billion in September.
“Despite the phenomenal 45 percent increase in U.S. exports to China over the past year and the more modest 19 percent increase in imports, the deficit continued to grow," he said. “This is because imports from China are five times as large as exports to China – so smaller import growth rates still produce larger dollar increases. However, a continuation of rapid export growth will eventually start bringing the deficit down.”
Overall exports of services were virtually unchanged at $34.5 billion, and imports of services were also essentailly unchanged at $28.7 billion.The import of crude oil dropped - to 316.59 million barrels from 343.49 million in August - but the average price of a barrel of oil declined by $3.60, to $62.52. The overall value of crude oil imports dropped to $19.79 billion from $22.71 billion.