The U.S. Commerce Department says a rebound in exports helped offset a smaller rise in imports to help narrow the U.S. trade deficit to $67.1 billion in October. That’s the lowest number in six months, after hitting a record high in September.
The October deficit was 17.6% below the all-time high of $81.4 billion in September, according to the Commerce Department and was the smallest monthly deficit since being $66.2 billion in the red back in April.
Economists believe this is evidence global supply chains are beginning to get back on track, and they believe smaller deficits this quarter could give a boost to the U.S. economy.
Data shows exports rose 8.1% to $223.6 billion in October while imports were up a much smaller 0.9% to $290.7 billion.
The trade deficit with China, the largest with any country, fell by 14% in October to $31.4 billion. In 2021, the deficit in goods trade with China is running 13.7% higher than the previous year.
America’s overall deficit trade deficit totaled $705.2 billion so far this year, 29.7% above the same period a year ago. Trade flows were sharply curtailed last year as the COVID pandemic restricted economic activity.
Part of the October increase is in oil exports as Gulf Coast refineries get back fully on line after Hurricane Ida swept through.
Also getting back on track is the import of global computer chips. The shortage of chips was hitting sectors like the auto industry pretty hard.
Although the supply chain is easing up, analysts caution shipping delays remain much higher than normal, and they also fear the new Omicron variant could cause another setback if travel restrictions are again implemented around the world.