US trade deficit narrows to $34.2 billion in June

WASHINGTON - The Associated Press

The U.S. trade deficit fell 22.4 percent to $34.2 billion in June, the Commerce Department says. That’s the lowest since October 2009. AFP photo

The U.S. trade deficit narrowed sharply in June to its lowest level in more than three and a half years. Exports rose to an all-time high and imports declined, signs that economic growth is stronger than previously thought.

The Commerce Department said on Aug. 6 that the June deficit fell 22.4 percent to $34.2 billion. That’s the lowest since October 2009 and down from May’s imbalance of $44.1 billion, which was revised lower.

Exports rose 2.2 percent to $191.2 billion in June. U.S. companies shipped more aircraft engines, telecommunications equipment, heavy machinery and farm goods. Imports dropped 2.5 percent to $225.4 billion. Oil imports declined to the lowest level in more than two years. The lower deficit could lead the government to revise economic growth for the April-June quarter higher.

Last week, the government said the economy grew at an annual rate of 1.7 percent in the second quarter, in part because trade cut nearly a full percentage point from growth. But the government estimated the June trade figures when calculating its first read on economic growth. The government will offer a more complete estimate for second-quarter growth.