US Trade Deficit Narrows as Export Growth Accelerates

The Commerce Department's Statistics Office announced Friday that the nation's goods trade deficit contracted to $82.4 billion last month, representing a 3.4% decline from the previous period.

The result exceeded market expectations. Analysts surveyed by Reuters had projected a deficit of $86.5 billion, making the actual figure notably more favorable than anticipated.

Export activity provided the primary driver of improvement. Goods shipments increased by $8.5 billion, reaching $219.7 billion for the month. Meanwhile, merchandise imports climbed by $5.6 billion to $302.1 billion.

The deficit's drag on economic performance has been substantial. During the first quarter, the trade imbalance reduced gross domestic product by 1.25 percentage points. The economy expanded at an annual rate of 1.6% in the most recent quarter, a significant acceleration from the 0.5% growth recorded in the fourth quarter of the previous year, which encompassed the October-to-December period.

March's trade figures had presented a more challenging picture. The goods deficit widened beyond expectations that month as import growth outpaced export gains, suggesting trade served as a headwind for first-quarter economic expansion.

April's performance marked an improvement from March's trajectory. The Commerce Department reported in April that the goods deficit had risen 5.3% to $87.9 billion in March, surpassing the $86.95 billion that Reuters-polled economists had forecast. February's deficit had stood at $83.5 billion.