WASHINGTON - The US trade deficit fell for the first time in six years in 2019 as the White House's trade war with China curbed the import bill, keeping the economy on a moderate growth path despite a slowdown in consumer spending and weak business investment.
With tensions in the 19-month US-China trade war easing, last year's narrowing in the deficit is unlikely to be repeated. It also imported fewer capital and other goods. The 1.3 per cent tumble in exports was led by decreases in shipments of capital goods, industrial supplies and materials, and other goods.
Washington and Beijing signed a Phase 1 trade deal last month. The deal, however, left in place US tariffs on US$360 billion of Chinese imports, about two-thirds of the total. Though the trade deficit is expected to swell, the economy is likely to continue growing moderately, with other reports on Wednesday showing a pickup in activity in the services sector and private employers boosting hiring in January.