Trade Gap Narrows Some

After June's trade whopper -- a record U.S. monthly deficit of $55.8 billion -- any lesser number would have looked good by comparison. And indeed, the Commerce Dept.'s Sept. 10 release of trade figures for July, which showed the gap narrowing to $50.1 billion, below economists' median forecast of $51.5 billion, provided some relief to financial markets after June's shocking report. The lower-than-expected July trade gap was due mostly to both downward revisions in imports in June, and a brisk 1.5% drop in goods imports in July.

The 1.4% July import drop that followed the 2.9% June gain left a more sustainable trajectory for imports, and the surprises were concentrated in the goods data, and particularly in the industrial-supplies component, which had previously been reported as posting remarkable 5% gains in both May and June.

More here.