WASHINGTON (AP) – The U.S. trade deficit declined sharply in April as exports posted a modest gain and imports fell, raising hopes that trade will not be as big a drag on economic growth in the current quarter.
The April deficit dropped 19.2 percent to $40.9 billion after surging to $50.6 billion in March, the Commerce Department said Wednesday. The March deficit had been the highest level since late 2008.
The big surge in the deficit reduced overall economic growth by nearly 2 percentage points in the first quarter, helping send the gross domestic product down at an annual rate of 0.7 percent.
In April, exports edged up 1 percent to $189.9 billion, led by a big rise in commercial airplane sales. Imports fell 3.3 percent to $230.8 billion. The deficit is the difference between imports and exports.
The big deficit increase in March reflected the end of a labor dispute which had tied up West Coast ports. With the ports fully operational, a backlog of imports, many from China, flooded into the country. Economists had predicted with the backlog processed, the deficit would shrink in April to more normal levels.