The U.S. trade deficit in July declined 11.6% to $39.47 billion after three straight months of increases, missing the median forecast for a decline to $42.7 billion. June’s deficit was revised higher to $44.66 billion and exports hit a 10-month high.
Overall, U.S. exports increased to $186.3 billion in July from $182.9 billion in June. Goods were $124.1 billion in July, up from $120.6 billion, while services were $62.3 billion in July, down less than $0.1 billion from June. Imports fell to $225.8 billion in July from $227.6 billion in June. Goods were $184.4 billion in July, down from $186.2 billion in June, while services were $41.4 billion in July, up from $41.3 billion in June.
Even though exports to China expanded by 3.8%, the politically sensitive U.S.-China trade deficit still increased by 1.9% to $30.3 billion in July. That’s largely due to imports from China also rising 2.4%. Meanwhile, U.S. exports to the European Union (EU) fell 9.5%, with goods shipped to the United Kingdom declining 9.2%.