WASHINGTON — The U.S. trade deficit plunged in February as exports fell but imports dropped even more. The narrower gap could give a slight if temporary boost to U.S. economic growth, which has flagged in recent months.
The Commerce Department said Thursday that the deficit — the amount by which the value of U.S. imports exceeds the value of exports — plummeted 16.9 percent to $35.4 billion from $42.7 billion in January.
The sharp decline reflected a $10.2 billion drop in imports since January to $221.7 billion, likely because of cheaper oil prices and a resolved West Coast ports dispute that interrupted the flow of 20 percent of the nation’s imports. The dispute led to sharp declines of imported goods from China and Japan, causing the trade deficit with both countries to fall.
Exports tumbled by a smaller sum, slipping $3 billion to $186.2 billion. They fell because a strengthening dollar has made American-made goods more expensive abroad. The dollar’s rising value has curbed expansion at U.S. factories, according to an index released Wednesday by the Institute for Supply Management.
“Although the decline in the February deficit is good news for first-quarter growth, trade is likely to be a drag on the U.S. economy in 2015,” said Gus Faucher, senior economist at PNC Financial Services.
