News / Economy

US Trade Deficit Narrows as Exports Hit Record High

FILE - Trucks drive past piles of shipping containers at the Qingdao port in Qingdao, Shandong province, June 8, 2014.
FILE - Trucks drive past piles of shipping containers at the Qingdao port in Qingdao, Shandong province, June 8, 2014.
VOA News

The U.S. trade deficit narrowed a bit more than expected in May as exports jumped to a record high, and the U.S. unemployment rate dropped to its lowest level in nearly six years.

The Commerce Department said on Thursday the trade gap fell 5.6 percent to $44.4 billion, indicating the U.S. economy is benefiting from a strengthening global recovery, data released Thursday showed.

April's trade deficit was revised slightly down to $47.0 billion.

The narrowing of the trade deficit in May followed five straight months of increases.

"The improvement in U.S. exports seen in the May trade data suggests that the world economic recovery is gaining traction," said Tu Packard of Moody's Analytics, as reported by the French news agency AFP.

Exceeded expectations

Economists polled by Reuters had expected the trade deficit to narrow to $45 billion in May from a previously reported $47.2 billion shortfall, suggesting trade could be less of a drag on second-quarter growth than earlier feared.

When adjusted for inflation, the deficit narrowed to $51.96 billion from $53.88 billion in April.

Trade subtracted 1.5 percentage points from first-quarter gross domestic product. The economy contracted at a 2.9 percent annual pace in the first three months of the year.

In May, exports increased 1 percent to a record high of $195.5 billion. Exports were driven by a surge in automobiles, parts and engines, which rose to a record high. Exports of consumer goods were also the highest on record.

Imports fell 0.3 percent to $239.8 billion as petroleum imports tumbled to their lowest level since November 2010. Non-petroleum imports, however, hit a record high in May.

That points to an acceleration in domestic demand, which cannot be satisfied with locally produced goods, and is consistent with expectations of a rebound in growth in the second quarter.

The politically sensitive trade gap with China rose to $28.8 billion from $27.3 billion in April. 

U.S. Unemployment Rate, June 2014U.S. Unemployment Rate, June 2014
x
U.S. Unemployment Rate, June 2014
U.S. Unemployment Rate, June 2014

Jobless rate

Thursday's report from the Labor Department shows the unemployment rate falling two-tenths of a percentage point to hit 6.1 percent in June.

The study also shows a net gain of 288,000 jobs. The job growth and the unemployment rate are both better than economists had predicted.

An economic advisor to President Obama said it is the first time since 2000 the economy gained 200,000 jobs per month for five straight months.  But Jason Furman also said many families are still struggling with long-term unemployment and stagnant wages. 

Government experts said job growth was widespread, and strongest in professional services, retail, food services and health care.

The data could be seen as evidence that the world's largest economy is recovering from the effects of unusually harsh winter weather that hurt the economy in the first few months of this year.

The upbeat data encouraged investors, who pushed the Dow Jones Industrial Average above 17,000 for the first time.

During the past year, the number of people officially counted as unemployed is down by 2.3 million, but that still leaves 9.5 million people out of work.

Other job data was mixed. The number of Americans working part time because they cannot find full-time work rose, while the number of people out of work longer than 27 weeks declined.

Some information for this report provided by Reuters and AFP.

You May Like

At International AIDS Conference One Goal, Many Paths

The 12,000 delegates attending 20th International AIDS Conference in Melbourne have vastly different visions about how to eradicate disease More

Disasters May Doom Malaysia’s Flag Carrier

Even before loss of two jets loaded with passengers on international flights, company had been operating in red for three years, accumulating deficit of $1.3 billion More

Afghan Presidential Vote Audit Continues Despite Glitches

Process has been marred by walkouts by representatives of two competing candidates, Abdullah Abdullah and Ashraf Ghani More

Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Nature of Space Exploration Enters New Agei
X
Elizabeth Lee
July 20, 2014 2:36 AM
Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.
Video

Video Nature of Space Exploration Enters New Age

Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.
Video

Video Chicago’s Argonne Lab Developing Battery of the Future

In 2012, the U.S. Department of Energy’s Office of Science awarded a $120 million grant to a new technology center focused on battery development - headquartered at Argonne National Laboratory in suburban Chicago, Illinois. As VOA’s Kane Farabaugh reports, there scientists are making the next technological breakthroughs in energy storage.
Video

Video In NW Pakistan, Army Offensive Causes Massive Number of Displaced

Pakistan’s army offensive in North Waziristan has resulted in the large-scale displacement of the local population. VOA's Ayaz Gul reports from northwest Pakistan where authorities say around 80 percent of the estimated 1 million internally displaced persons [IDPs] have settled in Bannu district, while much of the remaining 20 percent are scattered in nearby cities.
Video

Video Kurdish Peshmerga Force Secures Kirkuk, Its Oil

The Kurdistan regional government has sent its Peshmerga troops into the adjacent province of Kirkuk to drive out insurgents, and to secure the area's rich oil fields. By doing this, the regional government has added a fourth province to the three it officially controls. The oil also provides revenue that could make an independent Kurdistan economically strong. VOA’s Jeffrey Young went out with the Peshmerga and filed this report.
Video

Video Malaysia Reeling: Second Air Disaster in Four Months

Malaysia is reeling from the second air disaster in four months involving the country’s flag carrier. Flight 340 vanished in March and despite an extensive search, no debris has been found. And on Thursday, Flight 17, likely hit by a surface-to-air missile, came apart over eastern Ukraine. The two incidents together have left more than 500 people dead. VOA Correspondent Steve Herman reports from Kuala Lumpur.
Video

Video Diplomatic Crisis Grows Over MH17 Plane Crash

The Malaysia Airlines crash in eastern Ukraine is drawing reaction from leaders around the world. With suspicions growing that a surface-to-air missile shot down the aircraft, there are increasing tensions in the international community over who is to blame. Henry Ridgwell reports for VOA from London.
Video

Video Undocumented Immigrants Face Perilous Journey to US, No Guarantees

Every day, hundreds of undocumented immigrants from Central America attempt the arduous journey through Mexico and turn themselves over to U.S. border patrol -- with the hope that they will not be turned away. But the dangers they face along the way are many, and as Ramon Taylor reports from the Rio Grande Valley in Texas, their fate rests on more than just the reception they get at the US border.
Video

Video Scientists Create Blackest Material Ever

Of all the black things in the universe only the infamous "black holes" are so black that not even a tiny amount of light can bounce back. But scientists have managed to create material almost as black, and it has enormous potential use. VOA’s George Putic has more.
Video

Video Fog Collector Transforming Maasai Water Harvesting in Kenya

The Maasai people of Kenya are known for their cattle-herding, nomadic lifestyle. But it's an existence that depends on access to adequate water for their herds and flocks. Lenny Ruvaga reports for VOA, on a "fog collector."

AppleAndroid

World Currencies

EUR
USD
0.7305
JPY
USD
101.53
GBP
USD
0.5830
CAD
USD
1.0656
INR
USD
60.075

Rates may not be current.