U.S. Trade Deficit Narrowed to $43.1 Billion in November, Lowest Under Trump Administration

U.S. Trade Deficit With China Trended Lower in 2019

The U.S. trade deficit for goods and services narrowed $3.9 billion to $43.1 billion in November, down 8.2% from $46.9 billion in October, revised.

If it holds, it’ll be the lowest level since Donald J. Trump took office and the lowest since October 2016, when it was just $42.0 billion. The trade deficit fell to $43,103 (millions) in February 2017, slightly higher than the $43,086 (millions) for November 2019.

Forecasts ranged from a deficit as high as $49.3 billion to as low as $43.0 billion. The consensus forecast was $43.9 billion.

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis (BEA) reported exports rose by $1.4 billion to $208.6 billion in November, while imports fell by $2.5 billion to $251.7 billion.

The narrowing of the goods and services deficit was fueled by a $3.9 billion decline in the goods deficit to $63.9 billion and a largely unchanged $20.8 billion services surplus ($-0.1 billion).

Year-to-date, the trade deficit for goods and services fell 0.7% or $3.9 billion from the same period in 2018. Exports fell less than $0.1 billion or less than 0.1%, while imports fell $3.9 billion or 0.1%.

Three-Month Moving Averages

The three-month average ending in November for goods and services deficit fell $3.5 billion to $47.0 billion. Average exports declined $0.2 billion to $207.8 billion, while average imports fell $3.7 billion to $254.9 billion.

Year-over-year, the average goods and services deficit fell $8.4 billion from the three months ending in November 2018. Average exports declined by $1.5 billion, while average imports fell by $9.9 billion.

U.S. Trade Deficit With China

The politically-sensitive U.S. trade deficit with China trended down in 2019 after ballooning in 2018 during trade negotiations and tensions. The U.S.-China trade deficit was $80.8 billion in the first quarter (Q1). In Q2 and Q3, it fell to $79.9 billion and $77.3 billion, respectively.

The politically-sensitive U.S. trade in goods deficit with China decreased $2.2 billion to $25.6 billion in November. Exports rose $1.4 billion to $8.9 billion while imports declined by $0.8 billion to $34.5 billion.

The narrowing of the U.S. trade deficit for goods and services is a net positive for gross domestic product (GDP).