The US trade deficit unexpectedly narrowed in December as the recession that started nine months earlier led to the lowest level of imported goods in almost 2 1/2 years.
The US$25.3 billion trade gap in goods and services followed a revised US$28.5 billion deficit in November, the Commerce Department said. Imports of automobiles, computer accessories and cheaper petroleum declined, while an increase in air travel helped boost exports in December.
Last year, the trade deficit narrowed to US$346.3 billion from a record gap of US$375.7 billion in 2000 as the recession took hold and demand slowed. Still, the deficit may widen in coming months as the US economy accelerates more than that of its trading partners.
"The respite from growing deficits is going to prove to be temporary," said Ken Mayland, president of ClearView Economics LLC in Pepper Pike, Ohio, before the report. "Once again the US is going to be the locomotive for the world recovery. We are bound to see import growth heat up and export growth lag" as the US recovers before the rest of the world, he said.
Demand that accelerated in the fourth quarter is leading to improved profit forecasts at companies like Tokyo-based Alpine Electronics Inc. Earnings at some US companies such as Avon Products Inc. are being pressured by sluggish foreign demand.
Analysts had expected the trade deficit to widen to US$28.3 billion in December from November's previously reported gap of US$27.9 billion.
Imports fell 2.9 percent for the month to US$103.2 billion.
Goods imports fell 4.4 percent to US$86.3 billion in December, the lowest since June 1999.
Compared with last year, imports were down 6.3 percent, the first decrease since 1991, the year that included the end of the last recession.
Exports rose 0.2 percent to US$77.9 billion in December.
Exports were down 5.8 percent last year from 2000.
While the US, Japan and Germany, the world's three largest economies, are all in recession, recent US economic data on factory production, consumer spending, and employment provide evidence of a rebound.
US manufacturing of business equipment rose last month for the first time in a year and a half and initial claims for unemployment insurance benefits have held below 400,000 for six straight weeks, the longest stretch since the recession began in March, government figures showed last week.
Initial jobless claims increased by 10,000 to a level of 383,000 in the week that ended Saturday, the Labor Department said.
Retail sales, excluding automobiles, rose in January at the fastest pace in almost two years.
The world's largest economy will likely expand at a 1.5 percent annual pace this year, compared with a 1.1 percent rate of increase last year, according to the Blue Chip Economic Indicators consensus forecast.
The Japanese economy will probably shrink at a 1 percent pace, while the economies of the 12 countries using the euro are seen growing at a 1.2 percent pace, the survey showed.
Imports of autos and parts fell 3.2 percent in December after rising 1.9 percent the previous month, today's report showed.
Americans bought 6.2 percent fewer consumer goods and companies spent 2.6 percent less on new equipment.
Still, Alpine Electronics, a Japanese maker of car stereos for Honda Motor Co. and DaimlerChrysler AG, said last month it will beat its full-year profit target by 19 percent on better-than-expected US sales and a weak yen. Alpine's US sales in the quarter ended Dec. 31 were 14 percent better than the company expected.
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