WASHINGTON -- The U.S. trade deficit narrowed sharply in June to its lowest level in more than 3½ years as imports reversed the prior month's spike, suggesting an upward revision to second-quarter growth.
May's shortfall on the trade balance was revised to $44.1 billion from the previously reported $45.0 billion.
Economists polled by Reuters had expected the trade deficit to narrow only to $43.5 billion in June.
When adjusted for inflation, the trade gap narrowed to $43.2 billion, the smallest since January 2010, from $51.9 billion in May.
The smaller so-called real trade deficit in June suggests the government could raise its initial second-quarter gross domestic product growth estimate, published last week.
Trade subtracted 0.8 percentage point from second-quarter GDP growth. The economy expanded at an annual rate of 1.7 percent, stepping up from the first-quarter's 1.1 percent pace.
Belt-tightening in Washington and weaker global demand weighed on the U.S. economy in the first half of the year, but analysts expect activity to regain momentum for the rest of 2013 as the fiscal policy burden eases and growth in Europe picks up.
The three-month moving average of the trade deficit, which irons out month-to-to month volatility, fell to $39.5 billion in the three months to June from $40.5 billion in the prior period.
In June, imports of goods and services fell 2.5 percent to $225.4 billion. That reflected hefty declines in petroleum imports and industrial supplies and materials, which tumbled to levels last seen in November 2010.
Exports of goods and services increased 2.2 percent to a record $191.2 billion.
Strong export growth helped to lift the economy out of the 2007-09 recession and signs of a pickup after faltering in recent months should buoy expectations of an acceleration in GDP growth in the last six months of this year.
U.S. exports to the 27-nation European Union rose 1.5 percent in June. Exports to the EU in the first half of the year were down 5.5 percent compared to the same period in 2012.
Exports to China, which have been growing more slowly than in recent years, increased 4.5 percent in June.
China has been one of the fastest growing markets for U.S. goods, and exports to that country were up 4.2 percent for the first six months of 2013.
Imports from China fell 2.2 percent, lowering the contentious U.S. trade deficit with China to $26.6 billion from $27.9 billion in May.
Ways Retirees are Making Money
U.S. Trade Deficit Narrows Helped by Drop in Oil Imports
Walking dogs is a great way to stay fit, and many working individuals and families simply don't have time to give their pets the exercise they need. Dog walkers can charge $15 to $25 an hour, per dog.
Websites like Etsy.com have exploded the market for handmade goods of all sorts in the past few years. While it takes a lot of work to make a full-time living selling crafts, many retirees, stay-at-home moms and 9-to-5 workers turn their hobby into part-time income by selling crafts online. Whether you love to knit scarves, hand-quilt throws or throw pottery, there's an online market for your craft.
Retired teachers aren't the only ones with potential tutoring skills. If you're good in math, reading or other basic skills, tutoring could be a lucrative option. Advertise your independent tutoring services through word-of-mouth or Craigslist, or join an online tutor-finding service like Wyzant. Another option is to sign up with a local non-profit that pays tutors for their services.
If you love shopping for antiques, collectibles or other unique finds, consider shopping for them and then reselling them. Cruise estate and garage sales to find great deals, which you can turn around and sell on eBay or Craigslist at a profit.
If you're good with a wrench and know your way around crown molding, consider advertising your handyman services. Your state may require that you become licensed, especially for certain types of work, so check with your state's contractor licensing board to get started.
Engineers, scientists, management experts and others can all form careers as consultants. According to the Bureau of Labor Statistics, consultants in management make a median annual wage of $75,250, but you can also consult part-time for a high hourly fee. Turning your one-time profession into consulting jobs may be easier and more lucrative than you'd think.
If you're still healthy and mobile yourself, consider spending time with older folks who need help with everyday activities. Elder care can involve basics like running errands or giving a shut-in some regular company, or more involved activities like basic hygiene and nursing. Either way, this can be a fulfilling option.
On the other end of the spectrum, you could spend time caring for kids. As long as you've got the energy to keep up with little ones, you could offer all day or after school care for local children or even your own grandchildren. Just be sure to get and stay up to date on the latest nutrition and safety recommendations.
Maybe you don't really want to have a job, but have extra space in your home that you don't need. Consider taking on a renter in your spare room or basement. If you're traveling a lot during retirement, you could also rent your whole home out for short-term vacations.
Starting a blog is a great way to share your passion with the world, while making some extra money. There are plenty of online resources to teach you how to start, run and monetize a blog on just about any topic that interests you.
If you'd like to work sometimes and not others, consider signing up for temporary work. As employers seek to cut costs, many are hiring temporary workers to fill a myriad of roles. Temp jobs can let you experience lots of different types of work during retirement.
If you love growing fruit and vegetables, consider selling your extra produce at farmer's markets. Heirloom produce is in high demand right now. Another option is to grow perennials that need to be split each year. Each time you split your plants, you can sell the extras to aspiring gardeners.
If you're a local history buff or love the arts, consider finding opportunities to be a local tour guide or museum guide. You could even start your own local tour business, if your area is frequented by travelers.
Upcycled furniture is all the rage today, but some people simply don't have the time to spray paint and decoupage old pieces to give them new life. Retirees could upgrade old pieces of furniture and sell them online or locally, or offer their services for custom furniture upgrades.