US trade deficit narrows in 2019 for first time in six years
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E-mail Xinhua, February 6, 2020
The overall U.S. trade deficit narrowed in 2019 for the first time in six years as imports fell faster than exports amid protracted trade tensions, the Commerce Department reported on Wednesday.
The trade deficit in goods and services fell by 1.7 percent to 616.8 billion U.S. dollars in 2019, the first decline since 2013, the department said. That represented 2.9 percent of U.S. gross domestic product (GDP), down from 3 percent in 2018.
In 2019, exports fell by 0.1 percent to 2,499.8 billion dollars as shipments of capital goods, industrial supplies and materials declined, while imports fell by 0.4 percent to 3,116.5 billion dollars, led by fewer imports of industrial materials and supplies, computer accessories, telecommunications equipment and consumer goods.
U.S. trade deficit in goods with China declined sharply in 2019, but its goods trade deficit with Mexico and the European Union jumped to a record high, according to the department.
The administration of President Donald Trump has vowed to cut trade deficit and boost annual economic growth to 3 percent on a sustainable basis. However, the economy has failed to achieve that goal. U.S. economic growth slowed to 2.3 percent in 2019 from 2.9 percent in 2018 amid uncertainty stemming from trade tensions and weakness in global growth.
While some of the uncertainties around trade have diminished recently, trade policy uncertainty remains elevated and businesses continue to identify it as an ongoing risk, Federal Reserve Chairman Jerome Powell told reporters at a press conference last week.
"Business investment declined for the third consecutive quarter as weak growth abroad and tariffs took a toll on business planning," said Diane Swonk, chief economist at Grant Thornton, a major accounting firm, adding that orders for new equipment shrank in December, which suggested that "weakness will continue."
About two-thirds of respondents expect inflation-adjusted U.S. GDP to increase by 1.1 percent to 2 percent over the next four quarters, according to a recent survey released by the National Association for Business Economics (NABE).
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