U.S. Trade Deficit Narrows to 2-Year Low

A weak worldwide economic performance led to a sharp decline in the U.S. trade gap in the third quarter and a drop in import prices in November, the government said.

The U.S. current account deficit, the broadest measure of trade with foreign countries, shrank in the third quarter to the smallest gap in nearly two years as imports plunged, the Commerce Department said.

The department said the deficit fell to $95billion in the three months ended in September from $107.6billion in the second quarter. It was the smallest quarterly gap since that of $92.5billion in the fourth quarter of 1999.

The amount of goods, services and income payments imported to the U.S. sank 8.2% to $396.5 billion in the third quarter. Exports tumbled 6.6% to $313.8billion.

Imports of goods fell to $279.6billion from $293.5billion. Services imports declined to $41.4billion from $56.3billion. Big drops in travel expenditures and passenger fares contributed strongly to the drop in services imports.