The U.S. trade gap narrowed more than expected in September. Both sides of the trade equation moved in America’s favor. Our exports grew by 0.3% to $154.1 billion while exports fell 1% to $198.1 billion. With exports growing $500 million and imports shrinking by $2 billion, our trade deficit was only $44,000,000,000 for the month.
The exports were led by the “other” category. It grew 8.8% month-over-month and is now up 32.2% year-over-year. Food and beverages provided the next largest increase by growing 5.1% in September and 23.5% year-over-year. On the import side of the calculation, motor vehicles fell 6.7% for the month, and America bought 6% fewer “other” goods from foreign makers.
The deficits with Mexico and the European Union each improved by over $1 billion. The trade shortage with Japan fell $788 million. The largest part of our deficit continued to come from trade with China. It accounted for $27.831 billion of the monthly total and improved month-over-month by $204 million.
With a trade deficit as large and constant as ours, there will need to be a major shift in the world’s trade dynamics in order for it to become more balanced. The president has set a goal to double our country’s exports over the next five years. This is a daunting task in world of slow growth, but the administration may have an unwelcome ally. While this ally has been weak and, many argue, may become even more so, it also happens to be the world’s primary medium of exchange. It is our currency.