Trade deficit shrinks in May

The nation's trade deficit narrowed in May as near-record exports and lower energy prices helped shrink the gap. 

The gulf between exports and imports fell to $48.7 billion, down 3.8 percent, from an upwardly revised $50.6 billion in April, the Commerce Department said Wednesday. 

May exports were $183.1 billion, the second highest level on record and up 0.2 percent from the prior month, while imports amounted to $231.8 billion, down $1.6 billion. 

Imports dropped 0.7 percent to $231.8 billion, the lowest level since February, and down from $233.3 billion the prior month. 

Excluding oil, the deficit grew to $23.8 billion in May from $22.5 billion.

“U.S. exports posted their second-highest level on record in May despite some tough economic conditions abroad,” said Rebecca Blank, acting Commerce secretary.

Blank said the United States is on track to exceed last year’s export total of $2.1 trillion.  

"One of the bright spots in manufacturing exports has been motor vehicle and parts, which reflects the overall resurgence of cars and trucks made in the United States," she said. 

Exports through the first five months of the year were up 5.7 percent, or $48.6 billion, from the same period of 2011, hitting $908.7 billion.

Evidence of Europe's financial problems was reflected in the largest deficit in nearly four years. 

Meanwhile, the gap with China widened to $26 billion from $24.6 billion in April. 

The issue of China is another theme running through the presidential campaign, with GOP challenger Mitt Romney calling on the United States to crack down on the nation's currency and trade policies.

The Senate passed a currency-manipulation bill, but the House hasn't, and isn't expected to take up a measure anytime soon. 

Some lawmakers have complained that China isn't allowing its currency, the yuan, to increase in value against the dollar at a fast enough rate. 

During a campaign swing through Ohio last week, President Obama leveled a trade case against China for imposing unfair duties on U.S. auto imports, which trade officials argue violate international trade laws.