WASHINGTON (Reuters) - The U.S. trade deficit narrowed unexpectedly in March to $62.0 billion and hit its lowest level in more than half a year, as U.S. exports - including to China - climbed to new highs, the U.S. Commerce Department said on Friday.þþWall Street analysts had expected the trade gap to widen to about $67.0 billion, reflecting higher oil import volumes even though prices had declined. They also expected a widening of the trade gap after it narrowed in February, as imports picked up again following a lull caused by the Chinese New Year.þþInstead, the trade gap narrowed for the second month in a row and hit its lowest level since August 2005, when it totaled $58.5 billion. The 5.6 percent month-to-month drop from a downwardly revised $65.6 billion in February was the largest in a year.þþStill, the overall U.S. trade deficit for the first quarter of 2006 totaled $196.2 billion, putting it on a pace to exceed last year's annual record of $723.6 billion.þþIn March, record U.S. exports of $114.7 billion included record shipments to Canada, Mexico, the European Union, China, and South and Central America - a sign that a decline in the value of the U.S. dollar is helping U.S. manufacturers with overseas sales.þþExports of industrial supplies and materials, such as petroleum products and plastics, also set a record, as did exports of capital goods, which include industrial machines and computers.þþU.S. imports slid for the second month in the row to $176.7 billion, although imports from the EU, Mexico and South and Central America all set records.þþThe politically-sensitive trade gap with China - which hit a record $202 billion for all of 2005 - widened in March to $15.6 billion. U.S. exports to China were a record $5.0 billion, while imports from that country were $20.5 billion.þþThe trade gap with China totaled $47.3 billion for the first quarter of 2006, ahead of $42 billion for the same period last year.þþ
Source: NY Times
