U.S. October Trade Deficit Reaches 18-Month Low

By Jeff Ferry, Chief Economist

The U.S. international trade deficit in goods and services fell 7.6 percent in October, to $47.2 billion, as imports declined more than exports. This is the lowest monthly trade deficit figure since May 2018. The October decrease is due to a $3.7 billion drop in the goods deficit, to $68.0 billion, and an increase in the services surplus of $0.2 billion, to $20.8 billion. The fall in our monthly trade deficit, to under $50 billion for the first time in 17 months, combined with the 15 percent drop in our year-to-date China trade deficit, shows the Trump administration’s tariff policies are working. The U.S. economy continues to grow, consumer spending is growing, and inflation remains subdued. If we keep imports in check, we provide more demand for U.S. producers, which is the best path to growth and broadly shared prosperity. [more...]