Washington: The US trade deficit narrowed more than forecast in March as imports dropped by the most in more than six years, reflecting the economic slowdown.

The gap shrank to $58.2 billion, the lowest this year, from a revised $61.7 billion in February, the Commerce Department said on Friday in Washington. The shortfall with China was the smallest in two years.

Americans bought fewer automobiles and less crude oil, furniture and communications equipment from overseas as the economy grew at the slowest pace since 2001. Exports fell for the first time in more than a year, indicating economies overseas may also be starting to cool.

“On the import side,we have a weaker outlook from domestic demand,” Ellen Zentner, an economist at Bank of Tokyo-Mitsubishi UFJ Ltd in New York, said before the report.

“Some of our trading partners are starting to experience some weakness in growth, so external demand for our goods is not going to be strong.”

After eliminating the influence of prices, which are the numbers used to calculate gross domestic product, the trade deficit shrank to $47.2 billion, the lowest since November 2003, from $50.9 billion.

Imports decreased 2.9%, the most since December 2001, to $206.7 billion. Purchases of crude oil dropped, even as the average price for the month jumped to a record $89.85. The quantity of petroleum bought from overseas was the lowest since February 2007. The trade gap may not be able to keep narrowing as oil prices continue to surge.

Demand for goods from China suffered the biggest slump last month, helping to narrow the trade gap with that nation to $16.1 billion, the smallest in two years.

At the same time, exports to China were the second-highest ever. Total exports fell 1.7% to $148.5 billion.

Source : DNA