The US goods trade deficit narrowed sharply in August to $85.5 billion (vs $95.7 billion expected), down -16.8% MoM from $102.8 billion in July, as both exports and imports declined.

• Goods exports fell -1.3% MoM and -0.4% YoY to $176.1 billion, marking a modest pullback from July. Consumer good exports were down -6.8% MoM and -5.4% YoY.
• Goods imports dropped -7.0% MoM and 4.1% YoY to $261.6 billion, a larger decline that drove the narrowing of the deficit. Industrial supplies imports dropped -18.9% MoM and 8.6% YoY.
• Wholesale inventories stood at $905.2 billion, down -0.2% MoM but still +0.7% YoY as nondurable whole inventories dropped -0.6% MoM.
• The prior July wholesale inventory estimate was revised down from +0.1% MoM to virtually unchanged, suggesting flatter mid-summer stock trends.
• Retail inventories came in at $809.4 billion, essentially flat MoM but up +1.0% YoY. When excluding the -0.4% MoM drop in auto inventories, retail inventories were up 0.3% MoM.
• July’s retail inventory change was revised down slightly from +0.2% MoM to +0.1% MoM, softening the earlier estimate.