U.S. Trade Deficit Narrows as Exports Surge

The U.S. trade deficit decreased significantly in August due to a rise in exports and a reduction in imports, potentially impacting economic growth in the third quarter. The trade gap fell by 10.8% to $70.4 billion, with expectations that trade could continue to affect the GDP negatively.

In a notable economic shift, the U.S. trade deficit sharply decreased in August, driven by an increase in exports and a downturn in imports, according to recent reports.

The Commerce Department's Bureau of Economic Analysis reported a substantial 10.8% drop in the trade gap, reaching $70.4 billion, down from July's revised $78.9 billion. This exceeded economists' expectations, who had forecast a narrowing to $70.6 billion.

Despite this improvement, trade has subtracted from the gross domestic product for two consecutive quarters. With third-quarter growth predictions peaking at an annualized rate of 3.2%, the economic outlook continues to be closely watched following a 3.0% growth rate in the preceding quarter.

(With inputs from agencies.)