“Unexpectedly” was the word of the day Thursday for media reporting on Commerce Department numbers showing that the U.S. goods and services trade deficit fell in September to the lowest monthly level since June of 2020.
According to the Commerce Department report issued Thursday, the trade deficit shrank 10.9% from August, thanks to a 3.0% increase in exports dwarfing a much smaller 0.6% rise in imports. Analysts had predicted that the September trade deficit would grow to between $62.5-63.5 billion.
Instead, the trade deficit decreased $6.4 billion from its August level. At $52.8 billion, September’s trade deficit was about $10 billion lowered than predicted, prompting media to echo the pessimistic analysts’ surprise with headlines, such as:
- “US Trade Deficit Unexpectedly Shrinks To Smallest Since 2020” – Bloomberg
- “U.S. Trade Deficit Unexpectedly Narrows In September As Exports Surge” – Nasdaq.com
- “US trade balance shows unexpected improvement, defying forecasts” – Investing.com
The $289.3 billion value of exports was the second-highest monthly total on record, while shipments of consumer goods hit a record high.
Since April, President Donald Trump’s reciprocal tariff policies and resulting negotiations with countries charging exorbitant tariffs on U.S. goods has helped level the import/export playing field.
Despite their typical critical tone regarding Trump and his tariff policies, Thursday’s media reports of September’s smaller deficit occasionally (often begrudgingly) gave the president credit:
- “The U.S. trade deficit has fallen to its lowest monthly level in five years, as trade patterns adjust to President Trump's steep tariffs…Balancing the deficit has been a principal goal of Trump's tariff policies, which have changed rapidly since he took office.” – The Wall Street Journal
- “Because exports grew by more than imports, the U.S. trade deficit shrank, in line with the Trump administration’s goals… The recent drop in the trade deficit has moved the country toward accomplishing one of Mr. Trump’s biggest goals.” – The New York Times
- “President Donald Trump's protectionist trade policy, marked by sweeping tariffs, has caused big swings in the trade deficit, distorting the overall economic picture.” - Reuters
The Commerce Department's report for September was delayed until Thursday due to the recent, record-long government shutdown during a funding standoff in Congress.
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