US Trade Gap Unexpectedly Shrinks as Imports Drop

(Bloomberg) -- The trade deficit in the U.S. unexpectedly narrowed in January as imports fell for the first time in five months, indicating demand is cooling following the fastest pace of growth in six years.

The gap shrank 6.6 percent to $37.3 billion from $39.9 billion in December as refineries imported the fewest barrels of crude oil in a decade, Commerce Department figures showed today in Washington. Exports decreased for the first time in nine months, on fewer shipments of aircraft and autos.

Imports fell 1.7 percent to $180 billion from $183.1 billion in December. The U.S. imported 245 million barrels of crude oil in January, the fewest since February 1999. The decrease swamped an increase in oil prices.

Purchases of foreign-made automobiles and parts dropped by $1.48 billion, led by decreases in purchases of German and Japanese cars.

Imports may rebound in coming months as oil prices climb, consumer spending improves and a growing economy prompts companies to replenish depleted inventories.

After eliminating the influence of prices, which are the numbers used to calculate gross domestic product, the trade deficit shrank to $41 billion from $43.8 billion. The January figure was in line with the fourth-quarter average, indicating trade so far is not influencing growth estimates.

The U.S. economy will expand at an average 2.75 percent annual rate in the first half of this year, according to the median estimate of 52 economists in a Bloomberg survey taken from March 1 to March 10.