WASHINGTON – The U.S. trade deficit dipped slightly in September to $38.03 billion, but was still the second highest level on record, the U.S. Commerce Department said Tuesday.
The trade gap shrank just 0.7 percent from the record of $38.28 billion set in August, as both imports and exports fell slightly but remained near the highest levels of the year.
The August tally was revised down from an earlier estimate of $38.46 billion.
Imports were buoyed by crude oil prices, which averaged $25.47 per barrel in September — the highest level since $26.40 in December 2000.
The September figures pushed the total trade deficit for the first nine months of 2002 to a record $317.3 billion, an increase of 17.4 percent from $270.3 billion in 2001.
The near-record trade deficit renewed concerns it could trigger a sharp fall in the dollar, which has already declined 15 percent this year on a trade-weighted basis.
"The trade deficit continues to be an issue. It narrowed slightly but the issue here is we have a very big trade deficit as a percentage of GDP that poses a threat to the value of the dollar down the road, though not immediately," said Asha Bangalore, an economist with Northern Trust Co. in Chicago.
The individual trade deficits with China and the European Union have risen sharply this year, while the gap with Japan has narrowed a bit.
The September deficit with China, at $10.27 billion, was the second highest on record behind the August trade gap of $10.86 billion.
The latest monthly tally exceeded the average estimate of $37.33 billion made by analysts surveyed before the report.
Many expected imports to take a bigger tumble September, following a jump in August as companies stockpiled goods in anticipation of a dock workers strike on the U.S. West Coast.
West Coast ports were closed the last two days of September and the first eight days of October due to a labor dispute between dock workers and port operators.
However, imports totaled $120.19 billion in September, down just 0.5 percent from the year-to-date high of $120.78 billion in August. Exports — which rose more or less steadily in the first half of 2002 — declined for the second consecutive month in September to $82.16 billion, down 0.4 percent from August.
However, Commerce said it could not isolate the impact of the work stoppage on the monthly trade figures.
"To the extent that August and September involved some front loading ahead of the dock workers' strike, I would assume the trade deficit in October is going to be quite a bit narrower," said Ram Bhagavatula, chief economist with Royal Bank Scotland Financial Markets in New York.
Meanwhile, U.S. exports of advanced technology products remained depressed, as the monthly trade deficit for that category of goods hit a record $2.23 billion.
Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox