The latest Commerce Department report shows that the U.S. trade deficit contracted in September, falling to its lowest level in five months. The September trade deficit fell to $52.5 billion, down from an August deficit of $55 billion and slightly above economists’ expectations of $52.2 billion. On a year-over-year basis, the current trade deficit is 5.4 percent higher than the same period in 2018.
By nation and region, the largest trade surplus was with South and Central America ($5 billion). The U.S. continues to run deficits with China ($31.6 billion), the European Union ($15.7 billion), Mexico ($9.1 billion), Japan ($5.9 billion) and Germany ($5 billion).
For September, exports declined $1.8 billion to $206 billion. Foods, feeds, and beverage exports fell $1.5 billion, while automotive exports declined by $1 billion. Capital goods increased by $800 million, boosted by a$1.3 billion rise in aircraft-related products.
Imports were down $4.4 billion to $258.4 billion. Consumer goods fell $2.5 billion, with toys, games, and sporting goods declining by $600 million and household goods dropping by $800 million. Automotive imports were down $1.1 billion.
The trade war with China continues to weigh on the economy. President Donald Trump has imposed tariffs on more than $360 billion in Chinese imports and China has retaliated with its own tariffs on American products. So far this year, the deficit with China is 12.8 percent lower than the same period a year ago after edging down 0.6 percent last month. Exports to the country fell $800 million in September and imports from China fell $1.0 billion.
The U.S. recorded its first petroleum surplus since 1978 in September. The U.S. exported $15 billion in petroleum products in September while importing $14.7 billion for a small $252 million surplus. U.S. petroleum exports have been growing in recent years due to a boom in new production methods such as fracking.