Trade Deficit Down, QIV GDP May Double to 1.1%
NEW YORK (CNNMoney.com) -- The gap between the nation's imports and exports narrowed in December, according to a government report today, leaving the gap for the year sharply lower and ending a five-year streak of record annual trade deficits (see chart above).
A weak dollar during the year lifted exports, which allowed the 2007 trade gap to narrow by 6.2% to $711.6 billion, even as imports continued to increase due to the record price for oil imports during the year.
WASHINGTON (AP) -- Ian Shepherdson, chief U.S. economist at High Frequency Economics, said that the smaller December trade deficit will help to boost overall economic growth from the final three months of last year from the initial estimate of a mere 0.6% expansion. He predicted trade and a better reading on inventory stockpiles would boost growth in the gross domestic product to 1.1% when the figure gets revised later this month.