The US trade gap shrank to its lowest level in more than five years, resulting in a business upswing.
According to The Wall Street Journal, the U.S. trade gap is at its lowest level in more than five years. The Commerce Department released a report stating the trade deficit narrowed to $35.44 billion in February after a labor dispute erupted which tied up goods in the West Coast.
In total, exports decreased 1.6 percent from January to $186.25 billion, while imports decreased 4.4 percent to $221.69 billion – the largest drop in imports since the recession ended in 2009.
The West Coast ports facilitate nearly half of all U.S. cargo and came to a near halt due to employers and dock workers negotiating a new contract. The two sides reached a settlement in February and economists expected trade flows to bounce back, but the uptake in shipping has been slow.
“While an agreement has been reached, the slowdown has created a significant backlog and the reality is we are still waiting for many containers to be unloaded at the port,” Julie Whalen, chief financial officer at Williams-Sonoma Inc., told investors last month.
For companies who require goods from other parts of the world or ship their products out, this can mean a standstill in sales.
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