U.S. exports bucked a world-wide trade slowdown in June but face serious headwinds from the recession throughout much of Europe and softening growth in Asia.
The U.S. trade deficit with other countries narrowed to $42.9 billion in June from $48 billion a month earlier, the Commerce Department said Thursday, as imports fell and exports grew. Exports, which have been a pivotal contributor to the economic recovery, were strong almost everywhere except to Europe, where a recession and a protracted sovereign-debt crisis have sapped demand.
Europe's lackluster appetite for U.S. goods was more than countered by countries such as China, where reliance on U.S. exports continues to expand, even as that economy has slowed from double-digit growth—and new figures Friday morning showed that import growth for July in China weakened sharply to 4.7%. Asian markets fell in early trading Friday after the report.
In June, the U.S. notched increases in exports of a variety of goods including pharmaceuticals, cars and industrial engines. Exports increased $1.7 billion to $185 billion, the highest monthly tally ever. Imports declined $3.5 billion to $227.9 billion, driven largely by a drop in oil prices that reduced the value of petroleum imports. Total U.S. exports are up 6% in the first six months of 2012 from the same period a year ago. In the first half of 2011, they were up 16% from the year-earlier period.