US trade deficit shrinks rapidly in September

America´s trade shortfall with the rest of the world narrowed significantly in September, reaching a 19-month low, albeit alongside falling imports.

The US trade deficit fell from $40.5bn in August to $36.4bn (consensus: -$41.0bn).

Sales of goods and services overseas picked up by 0.6% month-on-month to reach $189.2bn, while imports shrank by 1.3% to $225.6bn.

"A 27.1% decrease in charges for use of intellectual property rights (IP), drove services imports lower, which is likely a correction following the sharp increase (+37.7%) in this series during August. We expect services imports to stabilize in Q4 following the IP-induced volatility in August and September. However, we view the weakness in goods imports as posing some downside risks to our near-term outlook for consumer and investment spending," Blerina Uruci at Barclays Research said in a research report sent to clients.