WASHINGTON — The U.S. trade deficit fell in September to the lowest level in five months as imports dropped more sharply than exports and America ran a rare surplus in petroleum.
The Commerce Department said Tuesday that the September gap between what America buys from abroad and what it sells shrank by 4.7% to $52.5 billion. That was down from the August deficit of $55 billion and was the smallest imbalance since April.
The politically sensitive deficit with China edged down 0.6% to $31.6 billion.
President Donald Trump has imposed tariffs on more than $360 billion in Chinese imports. China has retaliated with its own tariffs on American products as the world’s two largest economies have engaged in a trade war that has rattled global financial markets and slowed economic growth.
In relation to the trade war, Chinese President Xi Jinping promised more gradual market-opening steps at the start of an import fair Tuesday but no initiatives on technology policy and other irritants that sparked the tariff war with Washington.
The September deficit reflected the fact that exports fell 0.9% to $206 billion but imports fell an even faster 1.7% to $258.4 billion. For the first nine months of this year, the U.S. deficit is running 5.4% below the same period a year ago.
The deficit for all of 2018 totaled $627.7 billion.
Economists said they expect the trade deficit will be a drag on growth in the current October-December quarter as the continued weakness of the global economy further depresses demand for American exports.
“It’s hard to see anything other than further weakness in exports over the coming months,” said Andrew Hunter, senior U.S. economist at Capital Economics.
So far this year, the deficit with China is 12.8% lower than the same period a year ago although it remains the largest imbalance America runs with any country.