For the last year, most monthly trade reports have brought apparently
good news: falling U.S. merchandise trade deficits. Although these monthly
reports are subject to wide variations, the general trend of improvement seems
confirmed by the quarterly international transactions (balance of payments)
data. The preliminary merchandise trade deficit for the first quarter of 1991
was $18.4 billion, down from $27.7 billion in the fourth quarter of 1990,’ and
the second quarter deficit is expected to be even lower. Even if the deficit
remained at $18.4 billion per quarter for the rest of 1991, we would have an
annual trade deficit of $73.6 billion, the lowest since 1983.