The US trade deficit fell from a record in April on a drop in imports, suggesting that domestic demand is beginning to shift back to services.
With at least half the U.S. population completing their COVID-19 vaccination program, U.S. authorities are lifting virus-related restrictions on businesses, increasing demand for services like travel.
The trade deficit fell 8.2% to $ 68.9 billion in April, the Commerce Department said Tuesday.
Data for March was revised up to show that the negative balance widened to a record $ 75 billion instead of the previously reported $ 74.4 billion.
Economists polled by Reuters had estimated a trade deficit of $ 69 billion in April.
The trade deficit is likely to remain high as activity in the United States recovers faster than other economies, also thanks to massive massive fiscal stimulus. Strong demand as the economy reopens is testing supply chains.
Imports fell 1.4% to $ 273.9 billion in April. Goods imports fell 1.9% to $ 232 billion.
The decline was led by a $ 2.6 billion decline in consumer goods purchases, which reflected declines in textiles, toys, sporting goods and games, as well as home appliances. Imports of vehicles, spare parts and engines also decreased. But imports of mobile phones and other household items increased.
Exports grew 1.1% in April to $ 205 billion. Exports of goods rose 1.1% to a record $ 145.3 billion.
Listens
By countries, in April, the main trading partner of the United States was China, with a total trade of 58.6 billion dollars, with exports of 13.1 billion dollars and imports of 45.5 billion dollars.
Mexico was placed behind the Asian giant with exports of $ 22.5 billion and imports of $ 32.4 billion for a total trade of $ 54.9 billion.
In the first quarter of 2021, the US economy posted a deficit of $ 91.4 billion with China and $ 27.9 billion with Mexico. While with Canada it was $ 6 billion, this after a surplus of $ 1.2 billion in the fourth quarter of last year.
During the height of the pandemic, demand shifted to goods, at a time when Americans were locked up at home.
“Consumers spent more on goods during the booming homebound economy in 2020 and early 2021, as pandemic-related restrictions reduced spending on meals out, vacations and other services,” said Bill Adams, economist Senior at PNC Financial in Pittsburgh, Pennsylvania.
“With the pandemic under control, consumers are redirecting their expenses towards services produced in the country and away from imports.”
With information from Reuters
