The US trade deficit narrowed by 2.2pc in February from 8.5pc in January as imports fell by 0.5pc, according to figures this afternoon. The trade deficit for goods and services fell to a seasonally adjusted USD40.3bn in February from USD41.2bn in January, the Commerce Department said. The narrowing of the trade gap was unexpected, as economists had called for the deficit to widen to a seasonally adjusted USD42.0bn in February. The trade deficit narrowed as exports rose and imports fell, according to the Commerce Department. Imports fell 0.5pc to USD122.77bn, while exports rose 0.5pc to USD82.45bn.
The growing trade gap in the US has been weighing on the dollar in recent months. "Despite the fact that the dollar was weak throughout the month of February, the US still had difficulty attracting foreign capital," said Niall Dunne, economist at Ulster Bank. "This inability to attract foreign capital, even when US assets are cheap, is a worry for the market and a weight on the dollar." The petroleum deficit widened 6.5pc to USD9.88bn, and the volume of oil imports rose to an average 8.83 million barrels a day in February, compared with 8.66 million in January, the department said. //www.fxcentre.com