U.S. trade deficit shrinks to lowest point since '93

17 Jun 2002

(A.P.) The U.S. trade deficit narrowed dramatically in November to $7.06 billion, the best showing in nearly two years, as the gap with Japan shrank to its smallest level since the spring of 1993.

The Commerce Department said Wednesday that the deficit in goods and services dropped a sharp 13.5 percent from a revised October figure of $8.16 billion. It was the smallest imbalance since a $6.5 billion deficit in March 1994.

The November improvement reflected a big jump in sales of aircraft and computer parts as exports of capital goods climbed to a record level of $20.8 billion. Sales of military goods, including Patriot missiles to Saudi Arabia and helicopters to Greece, also took a big jump.

Even with the November improvement, the deficit for the year is headed for an all-time record with the imbalance in merchandise alone expected to come in around $162 billion, surpassing the old mark of $152.1 billion set in 1987. Analysts cautioned against reading too much into the trade improvement, saying it reflected in large part the fact that a sluggish U.S. economy was cutting into demand for imports as well as domestically produced goods.