AlQa'dah 19, 1436, Sep 3, 2015, SPA -- The U.S. trade deficit fell in July to its lowest level in five months as exports rose while imports declined, the government reported Thursday, indicating underlying strength in the economy amid concerns about slowing global growth. The Commerce Department said the trade deficit narrowed to $41.9 billion in July, a 7.4 percent decline from the June imbalance of $45.2 billion. Exports rose 0.4 percent to $188.5 billion in July, marking the first increase since April. Exports of food, industrial supplies, capital goods, and automobiles rose in July. However, exports remain constrained by a strong dollar, which has gained more than 15 percent against other major currencies since June 2014. Exports are 3.4 percent lower than last year's level. Imports fell 1.1 percent to $230.4 billion, but automobile imports were the highest on record. Imports of consumer goods fell sharply. Imports are 2.2 percent below last year's level, largely reflecting the big drop in oil prices. Exports to China fell 1.9 percent, and imports from that country fell 0.2 percent, leaving the politically sensitive bilateral trade deficit at $31.6 billion, up 0.4 percent from June. Exports to Canada plunged 8.3 percent and could fall further after the Canadian economy slipped into recession in the second quarter. Exports to recession-hit Brazil were the lowest since early 2010. Exports to the European Union fell 5.3 percent. So far this year, the deficit is running 3.6 percent above the 2014 level, reflecting weaker export sales. Economists are concerned that U.S. growth will be hurt by further declines in exports, reflecting a stronger dollar and overseas weakness in countries including China. The smaller July deficit implied a modest contribution to gross domestic product (GDP) from trade early in the third quarter. Trade contributed 0.3 percentage point to the economy's 3.7 percent annualized growth rate in the second quarter.
