21 June 2001, 18:14  US April trade gap seen as lighter drag on Q2 GDP than in Q1

By Cornelius Luca New York, June 21 (BridgeNews) - The 2.7% narrowing of the U.S. goods and services trade deficit in April to $32.2 billion from the upwardly revised gap in March of $33.1 billion is likely to drag the second-quarter gross domestic product by less than it did in the first three months of the year. However, the trade shrinking of the deficit on the month from a much larger figure in March denotes that the domestic consumption pulsates firmly.
While the marginal declining trade gap showed that the domestic appetite for imports remained largely unabated, economists also noted that the foreign demand for U.S. products is sagging. "The data is consistent to a second quarter GDP of 1.0%, and the 2.0% drop in exports is reflective of the weak overseas demand for U.S. products," said Jay Feldman economist at Credit Suisse-First Boston. Softer consumer spending, a bigger reduction in inventories and lower exports left the U.S. economic expansion weaker in the first quarter than originally thought. Gross domestic product grew just 1.3% from January to March, below expectations of 1.4% and the government's initial estimate of 2.0%

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