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Thursday, April 26, 2018

Trade Deficit Eases

A decline in imports eased the nation's goods deficit in March which came in much better than expected, at $68.0 billion and well under February's revised $75.9 billion.

Imports fell 2.1 percent with declines nearly across the board including a sharp 3.1 percent drop for capital goods and a 2.3 percent dip for consumer goods. Tariffs on steel and aluminum were imposed in March but there's no clear evidence of its effects in the initial data though imports of industrial supplies did fall 1.9 percent.

Exports have been very solid and rose 2.5 percent in March with gains led by a 4.0 percent jump in capital goods, which is the nation's key strength, and an 8.5 percent burst for food products.

After today's report, net exports don't look to be as much of a challenge for tomorrow's first-quarter GDP results as had been expected.

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