WASHINGTON (MarketWatch) â€” An early look at U.S. trade patterns in February shows a nearly 6% drop in the nationâ€™s trade deficit, reversing a big increase in the prior month.
The trade gap in goodsâ€”services are excludedâ€”fell to $64.8 billion in February from $68.8 billion in January, the government said Tuesday in its advanced report. The full report will be released next week.
The U.S. trade deficit often gyrates early in the new year depending on the date of the Chinese lunar new year, a long but annually shifting holiday during which must of the countryâ€™s business shuts down. The U.S. has a bigger trade deficit with China than any other country, by far.
Wholesale inventories, meanwhile, jumped 0.4% in February and retail inventories also rose 0.4%, according to advanced data. The government issues the advanced data to make it easier to estimate gross domestic product.
The decline in the trade deficit and the increase in inventory production could give a boost to gross domestic product in the first quarter. Morgan Stanley, for example, raised its estimate for GDP to 1.5% from 1%.
The government will unveil overall trade numbers early next week, but the size of the trade deficit is mostly tied to changes in exports and imports of goods. Trade patterns involving services such as financial advice or help-desk support rarely change much from month to month.
The government reported last month that the U.S. trade deficit in January totaled $48.5 billion.