Reflecting a sharp increase in the value of exports, the Commerce Department released a report on Wednesday showing the U.S. trade deficit narrowed in the month of June.
The Commerce Department said the trade deficit narrowed to $50.7 billion in June from a revised $54.8 billion in May.
Economists had expected the trade deficit to narrow to $50.1 billion from the $54.6 billion originally reported for the previous month.
The narrower deficit came as the value of exports spiked by 9.4 percent to $158.3 billion in June after tumbling by 4.3 percent to $144.7 billion in May.
Exports of automotive vehicles, parts and engines showed a significant increase along with exports of capital goods and industrial supplies and materials.
The jump in the value of exports outpaced a notable increase in the value of imports, which surged up by 4.7 percent to $208.9 billion in June after dipping by 0.7 percent to $199.5 billion in May.
Substantial increases in imports of automotive vehicles, parts and engines and consumer goods were partly offset by a sharp drop in imports of industrial supplies and materials, particularly non-monetary gold.
“The latest trade figures confirm that both exports and imports began rebounding in June, and we expect a continued recovery over the coming months as production catches up with the recovery in consumption,” said Michael Pearce, Senior U.S. Economist at Capital Economics.
He added, “However, with key U.S. export categories such as travel services and commercial aircraft exports likely to remain depressed for a while to come, we do not expect the trade deficit to continue narrowing over the coming months.”
The Commerce Department noted the goods deficit narrowed to $72.2 billion in June from $76.2 billion in May, while the services surplus inched up to $21.5 billion from $21.4 billion.
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