US trade deficit falls to eight-month low as gap with China narrows

The U.S. trade deficit dropped to an eight-month low in February, while the gap in value between goods exchanged with China fell 28 percent, according to federal data released Wednesday.

The overall U.S. trade deficit in goods and services dropped to 3.4 percent in February, according to the Census Bureau data, falling to $49.4 billion from $51.1 billion in January.{mosads}

A steep decline in goods exchanged with China helped drive down the gap. The value of Chinese goods imported to the U.S. fell from $34.5 billion in January to $24.8 billion in February, aided by an 18.2 percent increase in American exports to China.

The overall deficit in goods and services with China decreased $3.1 billion to $30.1 billion in February.

The drop in the U.S.-China trade deficit is likely welcome news to President Trump as his administration seeks to finalize a trade deal with Beijing.

The president has made narrowing that gap a primary goal of any potential deal, though economists say the trade deficit does not reflect the full picture of U.S.-China trade relations.

Trump has imposed tariffs on $250 billion in Chinese goods as leverage to convince Beijing to import far more American agricultural goods, expand foreign access to domestic markets and halt a series of trade and intellectual property schemes the administration considers unfair.

Beijing has called on the U.S. to lift all tariffs on all Chinese goods, but Trump and top administration officials have ruled that out.