US trade deficit shrinks 4pc in December

[Naveed Yaseen]

WASHINGTON: The US trade deficit shrank 4 per cent in December, as the global financial crisis cut US imports and exports for the fifth consecutive month, a US Commerce Department report showed on Wednesday.

The $39.9 billion trade gap was the smallest since February 2003, but bigger than a consensus estimate of $36.0 billion from Wall Street analysts. The December shortfall followed a much bigger contraction in the trade gap in November.

US imports of goods and services fell 5.5 per cent in December, following an 11.9 per cent drop in November, as businesses and consumers cut back on spending in the face of mounting economic woes.

Imports of autos and auto parts were the lowest since May 1999. Another big drop in the average price of imported oil to $49.93 per barrel, the lowest since December 2005, helped push the overall import tally lower.

US exports of goods and services fell nearly 6 per cent for a second month in a row, as the financial crisis took a bite out of foreign demand. Overall US goods exports were the lowest since October 2006, and auto and auto parts exports were the lowest since November 2004.

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