US trade deficit contracts in June

WASHINGTON, Aug. 4 (Reuters) - The U.S. trade deficit narrowed in June, but the trend is unlikely to be sustained amid strong domestic demand that is being satiated with imports.

The trade shortfall contracted 5.6% to $73.3 billion, the Commerce Department's Bureau of Economic Analysis and Census Bureau said on Tuesday. Economists polled by Reuters had forecast the deficit at $73.0 billion.

The government reported last week that the trade deficit widened further in the second quarter, subtracting a full percentage point from gross domestic product.

The economy grew at a 1.5% annualized rate last quarter, though domestic demand, driven by consumers and business ramping up spending on artificial intelligence infrastructure, increased at its fastest pace since the first quarter of 2023.

Imports dropped 1.8% to $388.0 billion in June. Goods imports fell 2.5% to $309.0 billion. Exports slipped 0.9% to $314.7 billion. Goods exports declined 1.9% to $206.9 billion.