Washington The U.S. trade deficit fell sharply in March to the lowest level in six months as U.S. exports climbed to an all-time high and the surge of textile shipments from China slowed.
The Commerce Department reported Wednesday that the gap between what the United States imports and what it sells to foreign countries narrowed by 9.2 percent in March to $54.99 billion, down from the record monthly deficit of $60.57 billion set in February.
Even with the big improvement in March, the deficit through the first three months of this year is still running at an annual rate of $696 billion, 12.8 percent higher than the $617.08 billion record set for all of 2004. Critics say the widening trade gap demonstrates the failure of the Bush administration's free trade policies.
The March improvement reflected a 1.5 percent increase in exports of U.S. goods and services, which rose to an all-time high of $102.2 billion, the fourth straight monthly record. The March improvement reflected gains in a wide range of products from commercial aircraft and telecommunications equipment to farm products and art work.
Imports, which had hit a record high in February, fell by 2.5 percent to $157.19 billion, reflecting a big drop in imports of foreign cars and in textile and clothing imports from China. This helped to offset a 4.1 percent increase in America's foreign oil bill, which rose 4.1 percent to $18.9 billion, the second highest level on record.
The deficit with China, which has become a growing target of attack in Congress because of its position as the country with the largest trade gap with the United States, declined by 7 percent to $7.83 billion in March.
Legislation that would impose 27.5 percent across-the-board tariffs on all Chinese imports is gaining support in Congress because of lawmakers' frustration with the refusal of the Chinese to stop linking their currency tightly to the U.S. dollar -- a practice American manufacturers contend gives Chinese companies a tremendous price advantage over U.S. goods.