Record high exports shrink Oct. trade deficit

Paul Davidson | USA TODAY

U.S. exports hit an all-time record in October, pushing down the U.S. trade deficit, the Commerce Department said Wednesday.

After falling three straight months, exports rose 1.7% to a record $192.7 billion. Higher shipments of industrial supplies, including oil, liquid natural gas and chemicals, partly drove the increase. Auto exports dipped.

Imports also jumped 0.5% to a 19-month high of $233.3 billion on sales to the U.S. of industrial supplies and consumer goods.

The trade gap fell 5.4% from September to $40.6 billion. A narrower trade deficit boosts U.S. economic growth as American manufacturers and services companies sell more products overseas and U.S. consumers buy relatively fewer foreign goods and services.

A healthy increase in U.S. exports over the past three months "is an encouraging sign for both U.S. manufacturing growth and the state of global demand," RDQ Economics said in a research note.

However, an upward revision to the September trade deficit prompted the research firm to cut its estimate of third-quarter economic growth to 3% from 3.2%. The government's second estimate of third-quarter growth is scheduled to be released Thursday. Its initial estimate was 2.8%.