WASHINGTON -- Record exports shaved the U.S. trade deficit in April for the second-straight month, the Commerce Department said Wednesday.
But for the year, the deficit is still up 11.5 percent from a year ago despite President Donald Trump's vow to close the gap through new tariffs on imports and renegotiated trade deals.
The Commerce Department said the trade deficit dropped to $46.2 billion in April, down from $47.2 billion in March and the lowest monthly deficit since September. Exports edged up 0.3 percent to a record $211.2 billion; imports dipped 0.2 percent to $257.4 billion.
The United States ran a $68.3 billion deficit in the trade of goods. That was partly offset by a $22.1 billion surplus in trade of services, such as tourism and banking.
The trade deficit in goods with China widened 8.1 percent to $28 billion in April; the monthly gap with Mexico narrowed 29.8 percent to $5.7 billion.
Trump campaigned on a promise to bring down the U.S. trade deficit -- the difference between what America sells to foreign countries and what it buys from them.
The president has focused much of his ire on China and Mexico.
He has proposed tariffs on up to $150 billion in Chinese imports to punish Beijing for forcing American companies to share technology in exchange for access to China's market. The Chinese have targeted $50 billion in U.S. products in retaliation. Talks to head off a trade war between the world's two largest economies have so far failed to produce a resolution, even though China has offered to step up purchases of U.S. farm and energy products.
Trump is also trying to renegotiate the North American Free Trade Agreement with Canada and Mexico in an effort to shift more investment and auto production to the United States and away from Mexico. Those three-country talks have stalled, and the White House has signaled that it hopes to negotiate with its two neighbors separately.
The administration is also imposing tariffs on imports of steel and aluminum, saying that reliance on foreign metals poses a threat to U.S. national security -- a position that has enraged U.S. allies including the European Union, Japan, Canada and Mexico.
A bipartisan group of 10 senators introduced longshot legislation Wednesday that would require Congress to sign off on tariffs imposed in the name of national security.
Senate Majority Leader Mitch McConnell, R-Ky., indicated he was not interested in spending too much time on the effort presented in private Tuesday by its chief proponent, Sen. Bob Corker, R-Tenn., with McConnell saying he preferred to focus on "getting bills passed."
The second-ranking Republican, Sen. John Cornyn of Texas, said he hoped Republicans concerned about the tariffs could prevail on the president to reverse course.
The president views trade deficits as a sign of economic weakness that can be brought down by more aggressive trade policies, though many analysts see a widening gap as a side effect of a growing economy that's importing goods. Exports and imports of goods account for about three-fourths of America's total trade. The U.S. typically runs a deficit in merchandise trade and a surplus in services.
The trade gap has continued to rise since Trump entered the White House partly because the U.S. economy is strong and American consumers have an appetite for imported products and the confidence and financial wherewithal to buy them.
Through April, the trade deficit in goods and services with the rest of the world rose to $201.8 billion from $181 billion the first four months of 2017.
The deficit in goods trade with China is up 11.7 percent for the year. And despite the decrease in April, the gap in goods trade with Mexico is up 4.8 percent this year.
"The trade deficit has worsened considerably since President Trump took office," said Lori Wallach, director of Public Citizen's Global Trade Watch and a critic of U.S. trade policy. She added: "If Trump is serious about reducing our trade deficit, then he must stay focused on changing China's unfair trade practices, not settle for the usual Chinese promises to buy more U.S. exports." Wallach also said NAFTA needs a major overhaul.
Trump heads to Canada on Friday for a meeting of the Group of Seven industrialized nations. The White House is expecting a chilly reception from Canada and western European countries, which are already frustrated over Trump's withdrawal from the Paris climate accord and the Iran nuclear agreement.
German Chancellor Angela Merkel previewed the dynamics on Wednesday, telling the German parliament that "it is apparent that we have a serious problem with multilateral agreements here, and so there will be contentious discussions."
Anticipating a tense two days in Quebec, Trump has complained about having to attend the summit, particularly since it comes just before his high-stakes meeting in Singapore with North Korean leader Kim Jong Un, said two people with knowledge of his thinking. But the White House has signaled no change in plans.
Information for this article was contributed by Paul Wiseman, Catherine Lucey, Zeke Miller, Lisa Mascaro and Kevin Freking of The Associated Press, and by Shobhana Chandra of Bloomberg News.
Business on 06/07/2018