USA trade deficit falls as exports hit record high

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Although not close to the "One Billion Dollar reduction" in China's "massive Trade Deficit with the United States" Trump tweeted about in March, the deficit in March was $26 billion - 11.6 percent less than the monthly deficit for February.

The 2018 first quarter goods trade deficit with China and with the world is significantly larger than figures for the first quarter of 2017 even as the March monthly goods deficit with China declined as USA exporters accelerated shipments to beat tariffs that may be imposed relating to the 301 action, which gave an extra boost to us exports overall this month.

Regionally, Canada's trade surplus with the United States narrowed for the fifth consecutive month to $1.7 billion in March compared with $2.3 billion in February.

America and China are engaged in a tit-for-tat dispute over import tariffs, which has sparked volatility in markets since the scrap began in March.

Canada's imports jumped 6 percent to a record 51.7 billion Canadian dollars in March, while exports rose 3.7 percent to 47.6 billion Canadian dollars, data showed.

President Donald Trump's pledge to quickly reduce the US trade deficit remained unfulfilled after the USA trade deficit rose in 2017.

The Trump administration argues that the perennial trade deficit is holding back economic growth.

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The 2018 first-quarter goods trade deficit with the world is up $24.4 billion compared to the $172.4 billion first-quarter global goods deficit in 2016, the previous year of the Obama administration. Canada sent 73.4 percent of all goods exports to the United States in March. In a separate report, the Labor Department said initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 211,000 for the week ended April 28.

More broadly, the USA trade gap has widened this year, increasing 18.5% in the first three months of 2018 compared with the same period a year earlier. There were also increases in exports of soybeans, corn and crude oil.

"Purchases of cars and consumer goods were responsible for the jump in imports".

Meanwhile, gains in imports of computer equipment (up 13 per cent), medium and heavy vehicles (up 9 per cent), and industrial machinery and equipment (up 3 per cent) suggested a solid pick-up in business investment. The overall USA trade deficit is mostly made up of manufactured and agricultural goods.

Demand for USA exports has helped support the manufacturing sector, aided by a weaker dollar and stronger growth overseas.

On a volume basis, which excludes the impact of price and currency changes, imports rose 5.3 per cent while exports were up 3 per cent.