June 8 (Bloomberg) -- The U.S. trade deficit narrowed more than forecast in April as a weaker dollar pushed exports to a record and demand for imports waned.
The deficit fell 6.2 percent, the most in six months, to $58.5 billion, from a revised $62.4 billion in March, the Commerce Department said today in Washington. The gap declined even as the shortfall with China widened.
The dollar's drop and expanding economies in Europe and Asia are fueling demand for American-made goods and the deficit is retreating from a record $67.6 billion in August. The gain in exports may also help economic growth accelerate after the slowest quarter in more than four years.
``The trade imbalance seems to be permanently on the mend,'' said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. ``Certainly, trade is going to contribute to growth in the second quarter.''
Rupkey predicted a deficit of $60.2 billion, the lowest among 74 economists surveyed by Bloomberg News before the report was published.
In April, exports rose 0.2 percent to a record $129.5 billion, as sales of foods, plastics and consumer goods such as jewelry improved. Imports slipped 1.9 percent.
``The rest of the world is growing,'' said Diane Swonk, chief economist at Mesirow Financial Inc. in Chicago. ``With the tailwind of a weak dollar, that's good news to keep our factories humming. This will probably easily throw GDP growth over the 3 percent range for the second quarter.''
Faster Growth
An improvement in the trade deficit is one reason why economists project growth will accelerate to a 2.6 percent annual pace this quarter, according to the median estimate of economists surveyed this month by Bloomberg News.
Economists at Morgan Stanley raised their second-quarter forecast for gross domestic product to 4.1 percent from an estimate of 3.6 percent prior to the report. Banc of America Securities LLC said in a note to clients that the figures imply a growth rate of about 3.5 percent, compared with a previous prediction of 2.5 percent.
Economies overseas are faring better. Gross domestic product in the 13 countries that use the euro rose 3 percent in the year ended March, compared with 1.9 percent in the U.S.
A weaker dollar, which makes American goods cheaper abroad, is also boosting exports. The dollar is down 6.4 percent since the beginning of last year against a trade-weighted basket of currencies of major U.S. trading partners.
GDP Calculation
Adjusted for changes in prices, figures the government uses in its calculation of gross domestic product, the U.S. trade deficit dropped in April to $54.9 billion, the lowest since September 2004, from $59.6 billion.
Demand for consumer goods from abroad slumped to $38.9 billion, from March's $40.4 billion. Eighty percent of the drop reflected a decrease in pharmaceuticals, a category that economists say has shown much volatility in the last few months.
Oil imports fell to $24.9 billion, from $25 billion a month earlier, as a drop in volume offset higher prices.
The cost of imported oil rose to $57.28 a barrel, the highest since September. Oil imports probably will remain elevated, economists said.
U.S. crude oil imports increased 2.22 percent last week, the Department of Energy reported on June 6. Imports have increased six of the last eight weeks.
Boeing Orders
Chicago-based Boeing Co., the world's second-biggest airplane maker, had a record order backlog of $262 billion in the first quarter, driven largely by Asian airline customers, Chief Executive Officer Jim McNerney said last month during a conference call with analysts. Twenty of the 35 aircraft it delivered in April went to foreign buyers.
An index of factory exports rose last month to the highest level since December 2004, according to a report from the Tempe, Arizona-based Institute for Supply Management last week.
The trade gap with China widened to $19.4 billion, the highest since January, from $17.2 billion in March. So far this year, the gap is up 19 percent compared with 2006. The deficit with China reached a record last year for a fifth straight time. Some U.S. lawmakers say an undervalued Chinese currency is to blame for the gap.
Meetings last month between U.S. and Chinese officials produced agreements on financial services and aviation but not on exchange rates.
Paulson's Warning
``Americans are impatient to see real change,'' Treasury Secretary Henry Paulson said in a speech this week. ``A large section of the American public doesn't believe that the benefits of trade are being shared equally between or within the two countries.''
Paulson also warned against growing protectionism in both countries and said China could help him head off such legislation in Congress by making progress in opening its markets.
Federal Reserve Chairman Ben S. Bernanke has also called on China to allow its currency to move more freely. Bernanke this week also reiterated concern about the magnitude of the U.S. trade gap.
``It would be important to bring greater balance to the world financial flows,'' Bernanke told a bankers conference in Cape Town, South Africa on June 5. ``But, it is something we can do gradually over a number of years.''
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