TRADE: Proof for The Pessimists

Proof for The Pessimists

When the U.S. trade deficit narrowed dramatically in July, optimists were sure that its improvement would go on gathering momentum, but pessimists warned, "Wait a while." Last week the August figures were released, and the pessimists were proved right. The gap between imports and exports widened to $12.2 billion, up from July's $9.5 billion. While the deficit has been shrinking this year -- to an estimated total of $140 billion, compared with $170 billion in 1987 -- progress may be slowing. That prospect has aborted the U.S. dollar's summer rally. The currency fell last week to 128.25 yen, capping a decline...

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