US trade deficit narrowed in January as imports declined

The U.S. trade deficit narrowed by more than expected at the start of the year ahead of broader supply-chain disruptions from the coronavirus that have since hit businesses dependent on shipments from China.

The overall U.S. deficit in goods and services trade shrank to $45.3 billion in January, from $48.6 billion in the prior month, according to data released Friday by the Commerce Department. The median estimate of economists surveyed by Bloomberg called for a gap of $46.1 billion. The U.S. typically runs a deficit in merchandise trade and a surplus in services.

The goods-trade deficit with China—the main target of President Donald Trump’s ire on the topic—narrowed in January to a seasonally adjusted $23.7 billion, the smallest since 2011. Imports from the Asian nation declined 5.5% to the lowest level since 2010, and exports rose slightly. The figures tend to be more volatile in the first two months of the year due to the Lunar New Year holiday.

The report offers insight into the early impact of the phase one trade deal between the U.S. and China in mid-January, while largely preceding the hit from the coronavirus that curtailed activity in China.

Overall imports fell 1.6% to $253.9 billion, led by drops in nonmonetary gold, autos and capital goods.

Exports dropped 0.4% to $208.6 billion, with declines in civilian aircraft and oil.