The U.S. trade deficit narrowed sharply in March as demand for imports fell by the largest amount since the last recession was ending.

Worker productivity rose by a better-than-expected amount in the first three months of the year while labor cost pressures eased.

Consumer inflation pushed higher last month as increases in energy, food and airline tickets overwhelmed the biggest drop in clothing prices in nearly a decade.

Consumers, beset by a credit crunch, rising energy and food costs and a prolonged housing slump, stayed away from the malls in March. Retail sales posted only a small increase.

The U.S. trade deficit in November surged to the highest level in 14 months, reflecting record imports of foreign oil. The deficit with China declined slightly while the weak dollar boosted exports to another record high.