Strong exports up taper chance

Marion Dakers
THE US trade deficit shrank 22.4 per cent to a three-and-a-half year low in June, official stats revealed yesterday.

The US Commerce Department reported a trade gap of $34.2bn, with exports of goods and services up 2.2 per cent to a record $191.2bn.

Analysts at Capital Economics said the data suggests that “second-quarter GDP growth was significantly stronger than the initial estimate of a 1.7 per cent annualised gain”.

But the figures also add fuel to speculation about the end of the US Federal Reserve’s massive stimulus programme.

Charles Evans, a dovish member of the Fed’s voting committee, said: “We are quite likely to reduce the flow of purchases rate starting later this year.”