America's overall trade deficit fell to $5.3 billion in the first three months of this year, the best showing since payments for Desert Storm helped give the country two rare quarterly surpluses last year, the government said Tuesday.
The Commerce Department said that the deficit in America's current account improved by 26.5 percent from a fourth quarter deficit of $7.22 billion.The current account is considered the best gauge of America's international competitiveness since it measures not only trade in merchandise but also trade in services and investment flows between the U.S. and other nations.
The better-than-expected improvement in the first three months of the year was attributed to a drop in oil prices, increased travel by foreign tourists in America and improved earnings by U.S. banks on their overseas earnings.
The trade report was the third piece of good economic news released Tuesday. The Commerce Department reported that construction of new homes and apartments jumped by 11 percent in May, recouping much of a 17.3 percent plunge in April.
And the Federal Reserve said output at the nation's factories, mines and utilities jumped 0.6 percent in May, the biggest advance in almost a year. (See story on D7.)
The $5.3 billion trade deficit was the smallest imbalance since two surpluses of $12.19 billion and $2.43 billion in the first and second quarters last year. But they resulted from payments from Japan, Saudi Arabia and other nations to reimburse the Pentagon for the Persian Gulf war.