U.S. trade deficit in goods narrows 3.5% in December

U.S. trade deficit in goods narrows 3.5% in December

The numbers: After spiking higher in the prior month, the U.S. deficit in goods reversed course in December.

The gap in goods narrowed to $82.5 billion in the final month of 2020 from $85.5 in November, the Commerce Department said Thursday. The deficit was $80.4 billion in October.

Advanced figures for wholesale trade rose 0.1% while retail inventories jumped 1% in December.

What happened: Exports of goods rose 4.6% in December and are down 2.6% for the past year. Imports rose 1.4% in December and are up 4.7% over the past 12 months.

Auto imports were strong in December, while exports were led by foods, feeds, and beverages.

The U.S. government will release overall trade figures for December next week, but the size of the deficit is closely tied to changes in exports and imports of goods.

Big picture: The U.S. trade deficit has widened throughout most of the year following the pandemic. The trade sector has recovered from the shock, fueled by Americans buying more imported goods while stuck at home.

Market reaction: U.S. stock futures were mixed Thursday a day after steep losses for major indexes. The Dow Jones Industrial Average

was down 2.1% on Wednesday.

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