The U.S. trade deficit narrowed in October as exports hit a record high, pointing to a pick-up in global demand that should help to support domestic growth in the fourth quarter.
The Commerce Department said on Wednesday the trade gap fell 5.4 percent to $40.6 billion. September's shortfall on the trade balance was revised to $43.0 billion from the previously reported $41.8 billion.
Economists polled by Reuters had expected the trade deficit to narrow to $40.0 billion in October. When adjusted for inflation, the trade gap fell to $48.3 billion from $51.4 billion the prior month. This measure goes into the calculation of gross domestic product and suggested trade will again contribute to growth this quarter.
The three-month moving average of the trade deficit, which irons out month-to-to month volatility, inched up to $40.9 billion in the three months to October from $40.2 billion in the prior period.