The US trade deficit narrowed unexpectedly in May as stronger growth overseas and the weak US dollar helped propel exports to record levels, government data released today showed.
The May trade gap of $46 billion was below a median estimate of $48.3 billion made by Wall Street analysts surveyed before the report.
The deficit narrowed for the first time in six months despite the highest prices for imported oil in nearly 22 years, which helped pushed overall imports to a record as well.
The smaller-than-expected trade gap could prompt analysts to raise their forecasts of second-quarter US economic growth.
US exports jumped nearly 3 per cent to a record $97.1 billion, as overseas companies stepped up purchases of capital goods and industrial materials ranging from civilian aircraft and industrial engines to computers and drilling equipment. US auto and auto part exports also set a record.
Despite the smaller monthly trade gap, the annual deficit remained on track to surpass last year's record of $496.5 billion. In the first five months of this year, the trade gap has soared to $231.0 billion from $208.7 billion in the same period last year.
US imports increased fractionally in May to a record $143.1 billion, aided by a record oil import bill of $10.5 billion. US imports from OPEC countries hit a record $7.4 billion and the trade gap with those countries was a record $5.6 billion.
The politically sensitive trade deficit with China rose slightly to $12.1 billion as imports from that country leapt to their second highest level on record. US exports to the Asian giant rose more than 6 per cent to $2.9 billion.