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U.S. Trade Deficit Narrows More Than Expected To $49.3 Billion In November

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A government shutdown-delayed report released by the Commerce Department on Wednesday showed the U.S. trade deficit narrowed by much more than anticipated in the month of November.

The Commerce Department said the trade deficit narrowed to $49.3 billion in November from a revised $55.7 billion in October.

Economists had expected the deficit to narrow to $54.0 billion from the $55.5 billion originally reported for the previous month.

The much narrower than expected deficit largely reflected a steep drop in the value of imports, which plunged by 2.9 percent to $259.2 billion in November after rising by 0.4 percent to $266.9 billion in October.

Imports of consumer goods, including cell phones and other household goods, showed a significant decrease along with imports of industrial supplies and materials.

The report said the value of exports also fell by 0.6 percent to $209.9 billion in November after edging down by 0.1 percent to $211.2 billion in October.

Notable decreases in exports of industrial supplies and materials, gem diamonds, and drugs were partly offset by a jump in exports of civilian aircraft.

Andrew Hunter, Senior U.S. Economist at Capital Economics, said the data suggests that trade made a small positive contribution to GDP growth in the fourth quarter

"That boost is unlikely to last for long, however. Along with the appreciation of the dollar last year, the slowdown in global demand will continue to weigh on exports for the foreseeable future," Hunter said. "As a result, we expect trade to be a small drag on economic growth for most of this year."

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