One result of lower oil prices is a lower trade deficit. The Commerce Department reported this morning that the U.S. trade deficit for November fell to its lowest point in five years.
“The gap between the value of imports and exports narrowed to $40.4 billion in November, from $56.7 billion a month earlier, the Commerce Department reported on Tuesday. That marked a 28.7 percent decline in one month.
“The trade deficit shrank as American consumers clipped their demand for foreign-made consumer goods, and tumbling energy prices slashed the value of imported oil and gas. Petroleum imports dropped 36.5 percent to $23.6 billion.”
The reason for the big decline wasn’t that we’re exporting more, it’s that we’re importing less. Imports drop 12% from October to November.