The U.S. trade deficit unexpectedly narrowed in September as exports rose sharply, suggesting global demand for US goods was holding up despite a debt crisis in Europe. Other data on Thursday showed a drop in new claims for jobless benefits last week, although a severe storm that battered the East Coast distorted the figures.
The trade gap shrank 5.1% to $41.55 billion, the smallest deficit since December 2010, the Commerce Department said. Economists had expected it to widen to $45.0 billion.Exports jumped 3.1%, the biggest increase in more than a year. The export gain more than offset a 1.5% increase in imports that was centered on purchases of consumer goods.
The data was the latest positive sign for the US economy, which has appeared to perk up as consumers spend more freely and home construction quickens. "This was a very encouraging report as the improvement in both export and non-petroleum import activity suggest improving demand both domestically and globally," said Millan Mulraine, an economist at TD Securities in New York.Chinese demand for US products appeared to help exporters in September. China bought $8.8 billion in US goods and services, up 0.3% from a month earlier, although those figures were not seasonally adjusted.
Exports to the European Union, where a debt crisis has pushed several countries into recession, were flat.