U.S. Trade Deficit Narrows in August Amid Import Decline
The U.S. trade deficit in goods significantly decreased in August due to a fall in imports. The gap fell to $85.5 billion, surpassing economists' predictions. Imports plunged by $19.6 billion, while exports saw a minor reduction. The deficit's decrease was a crucial factor in boosting quarterly economic growth.
- Country:
- United States
In a significant economic development, the U.S. trade deficit in goods contracted sharply in August, as reported by government data. The Commerce Department revealed that the goods trade gap narrowed by 16.8% to $85.5 billion last month, defying economists' forecasts of a deficit of $95.2 billion.
Much of this change can be attributed to a drastic $19.6 billion drop in goods imports, reducing the total to $261.6 billion, while goods exports fell slightly by $2.3 billion to $176.1 billion. President Donald Trump's tariffs have contributed to the volatility in goods imports this year, influencing GDP trends differently across quarters.
Despite fluctuating figures, growth estimates for the third quarter are gradually aligning around a 2.5% annualized rate, catalyzed by a shrinking trade deficit. Previously, the economy expanded at a 3.8% pace from April to June, demonstrating the impact of trade dynamics on economic momentum.
(With inputs from agencies.)
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