The U.S. trade deficit narrowed dramatically in the first three months of the year to $18.37 billion, the smallest imbalance in nearly eight years, the government said.
The Commerce Department said the first-quarter deficit was 33.8 percent smaller than a $27.73 billion imbalance in the final three months of 1990 as the U.S. recession dampened demand for imports while U.S. overseas sales climbed to an all-time high.U.S. exports, helped by increased corn sales to the Soviet Union, edged up 0.2 percent to $100.86 billion while imports fell 7.1 percent to $119.22 billion.
The trade deficit, the difference between imports and exports, was the smallest quarterly imbalance since a $15.4 billion deficit in the second quarter of 1983.
The report on merchandise trade on a balance of payments basis confirmed a trend already noted in the department's monthly trade reports. The figures differed slightly because of adjustments made to take out the impact of government military sales on the trade flows.
The Bush administration is counting on continued strong overseas demand for American products to help lift the country out of its first recession in eight years.
However, private economists noted that export growth has slowed noticeably in recent months as economic growth has weakened in many of America's major overseas markets.
For the first quarter, non-farm exports actually declined slightly to $90.9 billion. But this weakness was more than offset by a 5 percent rise in sales of agricultural goods, which rose to $9.9 billion.
The Commerce Department said that much of the strength in farm sales came in an increase in corn shipments to the Soviet Union resulting from the larger farm credits awarded the Soviets last year by the Bush administration.
Corn prices rose 2 percent during the quarter while the average price of wheat fell by 16 percent. Soybean and cotton prices were both down an average of 2 percent.
Non-oil imports dropped 4 percent to $106.1 billion during the first quarter, the lowest level since the final three months of 1988. The largest decreases came in consumer goods and autos.
America's foreign oil bill fell by 27 percent to $13.2 billion in the first quarter, reflecting the big drop in crude oil prices following the onset of the Persian Gulf war. The average number of barrels imported daily rose to 7.10 million, up from 6.86 million, but the price per barrel dropped from an average of $28.75 to $20.33.
On a country by country basis, the biggest deficit was with Japan, a quarterly shortfall of $11 billion. The largest surplus was with the countries of Western Europe as American sales overshadowed imports from that region by $4.6 billion, an increase of $3.3 billion from the fourth-quarter surplus.