By Rex Nutting, MarketWatch
WASHINGTON (MarketWatch) - The U.S. trade gap unexpectedly narrowed in August to $30.7 billion on a big drop in imports of crude oil, the Commerce Department reported Friday.
The trade gap is the difference between exports and imports of goods and services. After a big increase in trade in July, volumes dropped back in August, a sign of fits and starts in the U.S. and global economic recoveries.
Imports fell by $913 million, or 0.6%, to $158.9 billion in August, as imports of crude oil fell by $1.28 billion.
Exports rose by $228 million, or 0.2%, to $128.2 billion, the highest since December. Exports were led by autos, metals and soybeans. Exports of capital goods fell to the lowest level in four years.
Imports and exports were boosted by increased trade in autos and auto parts to the highest level this year.
Economists surveyed by MarketWatch expected to the trade gap to widen to $33.6 billion in August, based on higher prices for crude oil. However, the volume of imported oil dropped by 9.4%.
The July trade deficit was revised lower to $31.9 billion from $32 billion, based on more complete data.
The price of imported crude oil rose $2.27 to an average of $64.75 a barrel, the highest since November. But the volume of imported crude dropped to 8.7 million barrels a day from 9.6 million in July. After adjusting for inflation, real seasonally adjusted imports of petroleum fell 10.2% to a 10-year low.
After adjusting for price changes, the trade gap in August narrowed by 2.7%, a positive for U.S. gross domestic product. Economists currently expect U.S. GDP to rise at an annual rate of 3.4% in the third quarter, which would be the first increase in a year.
Inflation-adjusted imports fell 1.9% in August, while real exports fell 1.5%.
Global trade collapsed a year ago when the global financial crisis hit, and is now slowly recovering. In the first eight months of 2009, real (inflation-adjusted) exports are down 18.2% compared with the same period a year ago. Real imports are down 19.6%.
Compared with last August, real exports are down 19.5%, and real imports are down 18%.
Details
Imports from China, Canada and Mexico rose on a not-seasonally adjusted basis. Exports to the European Union fell to a three-year low.
Exports of goods were unchanged at $86.8 billion. Exports of services rose 0.5% to $41.4 billion.
Imports of goods fell 0.6% to $128.7 billion. Imports of services fell 0.3% to $30.2 billion.
Real exports of capital goods fell 4.2%, while real imports of capital goods dropped 0.3%.
Real exports of industrial supplies were flat, while real imports fell 6%.
Real exports of consumer goods fell 1.4%, while real imports fell 1.9%.
Real exports of autos and auto parts rose 7.3%, while real imports rose 8.5%.
Real exports of foods and feeds rose 1.2%, while real imports fell 3.9%.
