U.S. trade deficit narrows in July as imports decline

WASHINGTON, Sept. 2 (Xinhua) -- The U.S. trade deficit narrowed in July as imports declined amid rising COVID-19 cases caused by the Delta variant, the U.S. Commerce Department reported on Thursday.

U.S. exports rose by 1.3 percent to 212.8 billion U.S. dollars in July while imports declined by 0.2 percent to 282.9 billion dollars, according to the department. The goods and services deficit shrank by 4.3 percent from the previous month to 70.1 billion dollars.

"The July trade report showed the ripple effects of pandemic-era disruption as the United States and the rest of the world attempt to return to some semblance of normal," Tim Quinlan and Shannon Seery, economists at Wells Fargo Securities, said Thursday in an analysis.

The decline in imports perhaps reflected the transition to services spending on the part of the U.S. consumer and ongoing bottlenecks in global supply chains and shipping, the economists said, adding if sustained, net exports could provide a modest boost to U.S. gross domestic product (GDP) in the third quarter.

"That said, it all depends on how trade evolves during the remaining two months of the quarter. Supply issues and capacity constraints continue to weigh on our visibility," they noted.

The U.S. economy grew at an annual rate of 6.6 percent in the second quarter in revised estimate, up from the 6.5 percent in advance estimate, the Commerce Department reported last week.