Trade Deficit Shrinks, but It May Not Last : Commerce: A one-time surge in U.S. aircraft sales cuts the gap to $6.6 billion in June from $7.14 billion in May.

The U.S. foreign trade deficit narrowed sharply in June, the government reported Wednesday, but analysts said that the improvement was an aberration masking signs that America’s export boom is waning and threatening to undermine the already weak recovery.

The Commerce Department said the nation imported $6.6 billion more than it exported, down from $7.14 billion the previous month. Exports soared 7.2% to $38.28 billion, while imports rose 4.7% to $44.88 billion, despite the sluggish economy at home.

But analysts pointed out that the increase in exports stemmed largely from a one-time boost in the sale of aircraft, whose prices are so high that they can skew trade figures. Exports would have risen only moderately without the increase in aircraft exports, which jumped from $1.47 billion in May to $2.57 billion in June.

Robert G. Dederick, economist at Northern Trust Co. in Chicago, said the figures show that sluggish economic conditions are continuing to dampen overseas markets for U.S.-made products, furthering a trend that began a few months ago.

“The basic message in the report is that the dynamism we’ve been getting from the export boom has pretty well played itself out,” Dederick said. Officials will have to look elsewhere to find ways to bolster the U.S. economy, he said.

It was not immediately clear what impact the continued deterioration in foreign trade will have on the U.S. economy. The export boom has been a major factor in the economy for almost three years.

Analysts said some of the increase in imports may prove transitory if foreign producers decide that their goods are not selling as rapidly as hoped. There are indications that inventories of unsold imports have begun growing in recent weeks.

At the same time, exports of U.S.-made capital goods, which had proved a mainstay of the economy during most of 1991 and early 1992, are tapering off--even in the face of a declining dollar, which makes American goods less expensive abroad.

Wednesday’s report brought the overall trade deficit to an annual rate of $70.94 billion, compared to $65.4 billion the previous year and $101.7 billion in 1990.

Still, Cynthia Latta, economist at DRI-McGraw-Hill, an economic forecasting firm, predicted that if the situation deteriorates more, as is expected, the deficit is likely to swell to $85 billion.

Dederick said Wednesday that the sharp rise in imports shows that “the economy here is growing,” albeit sluggishly.

As usual, the largest segment of the June deficit reflected an imbalance in trade with Japan. The difference accounted for 51% of the total gap, although the deficit with Japan actually narrowed slightly during the month--to $3.39 billion from $3.50 billion the previous month.

The United States has been running a trade surplus with Europe, but in June there was a surprising deficit of about $90 million.

The deficit with Canada improved, shrinking to $440.6 million from $836.4 million.

The nation continued to record surpluses in its trade with Mexico, exporting $334.2 million more than it imported in June. That compares to a surplus of $434.4 million in May.

Sales of U.S.-grown agricultural products edged up in June to $3.12 billion from $2.96 billion in May.

America’s foreign oil bill jumped 12.6% to $4.62 billion, reflecting both an increase in import volume and a rise in world prices.

Oil prices rose to $18.25 a barrel in June from $16.72 the month before.

Merchandise Trade Deficit

Billions of dollars, seasonally adjusted; import figures exclude shipping and insurance.

June, ‘92: 6.59

May, ‘92: 7.14

June, ‘91: 4.67

Source: Commerce Department