Trade deficit narrows

Bloomberg.com:

The U.S. trade deficit unexpectedly shrank in March to $55 billion, the narrowest in six months and a sign the economy was healthier in the first quarter than the government initially estimated. Exports were an all-time high and imports of consumer goods declined after a record trade gap of $60.6 billion in February, the Commerce Department said today in Washington. The median forecast in a Bloomberg News survey of 67 economists called for a deficit of $61.9 billion. ``It's a relief,'' said James Glassman, senior U.S. economist at JPMorgan Chase & Co. in New York, in an interview. ``It does dampen the fears that there was something bad going on in the U.S. economy.'' First-quarter growth was ``closer to 4 percent'' than the 3.1 percent the government estimated last month. U.S. manufacturers sold more consumer goods and business equipment abroad in March, aided by a dollar that has declined about 7 percent against a basket of major currencies in 12 months. The good news on the trade deficit may not last long as Americans keep snapping up foreign-made televisions, electronics and automobiles, economists said.

This is very good economic news. I think that the needed trade deficit corrections are more likely to be gradual and soft, rather than the hard crash some analysts fear. This news adds hope that this view might turn out to be correct.