WASHINGTON (AP) — The U.S. trade deficit narrowed in January to $41.1 billion, reflecting a pickup in foreign demand for a variety of American-made goods, including industrial supplies, household appliances and cosmetics.
The Commerce Department reported Wednesday that the trade gap narrowed by 8.4 percent in January from December's deficit of $44.9 billion as U.S. exports posted a solid gain and imports fell.
Even with the improvement, however, January's trade gap marked the second-biggest monthly deficit on record.
The trade deficit in January ended up being smaller than the $43.5 billion deficit that economists were forecasting.
The narrowing of the trade deficit came even as the average price of imported crude oil jumped to $27.73 a barrel in January, the highest price since November 2000.
January's per-barrel price was $3.58 higher than December's, marking the largest one-month gain since September and October 1990.
"I take small consolation in the drop in the deficit," said economist Ken Mayland, president of ClearView Economics. "The trade deficit is still huge and is a drag on the economy."
On Wall Street, stocks were mixed. The Dow Jones industrial average was down 17 points, while the Nasdaq index was nearly flat in the first half-hour of trading.
In January, exports of goods and services rose by 1.6 percent to $81.9 billion.
Exports of industrial supplies, including chemicals and steel, increased to $14 billion, the highest level since April 2001. Overseas sales of U.S.-made consumer groups — a broad category that includes household appliances, cosmetics and furniture — rose to $7.4 billion, the best showing since May 2001.
The dollar has lost altitude over the past year, dropping in value by around 14 percent, a good development for U.S. exporters because it makes their products more competitive on foreign markets and less expensive for overseas buyers.
Imports, however, dropped by 2 percent in January to $123 billion, reflecting Americans' weaker demand for a wide variety of foreign-made goods.