The US trade deficit shrank sharply in November to the smallest gap in nearly a year as imports fell more than exports, government data released Wednesday showed.
The trade gap narrowed to $39.0 billion from a revised $42.2 billion in October, a 7.7 percent decline month-over-month, the Commerce Department said.
Lower prices for crude oil and petroleum imports factored into the stronger-than-expected narrowing of the gap, which analysts had expected to come in at $41.8 billion.
The department's prior October estimate was $43.4 billion.
In November, exports of goods and services fell to $196.4 billion, a decrease of $2.0 billion, or 1.0 percent, from October.
Imports dropped by a heftier $5.2 billion (2.2 percent), to $235.4 billion.
Imports of petroleum products plunged 11.8 percent to $23.1 billion amid a sharp fall in global crude oil prices.
The United States paid on average $82.95 a barrel for crude in November, which currently is trading below $50 a barrel.
At the same time, US exports of oil products, backed by a boom in natural gas from shale production, leaped by 5.4 percent, driving the US oil trade deficit down 25 percent to $11.4 billion, its lowest level in almost 11 years.
The year-end holiday shopping season that began in November brought a record $48.5 billion in goods imports.
The politically sensitive goods trade gap with China narrowed by 8.0 percent to $29.9 billion as imports from the world's second-largest economy fell.
With the European Union, the goods shortfall fell 7.1 percent to $11.8 billion.
In the first 11 months of the year, the overall US trade deficit rose $22.3 billion, or 5.1 percent, from the same period in 2013.
"A strong dollar should continue to boost imports of cheaper foreign goods; though we will have to wait and see if the deflationary effects of dollar appreciation will cause domestic companies to cut prices," said Jay Morelock of FTN Financial.