Has the tide turned for US exporters?

The US trade gap - the amount by which the cost of imports exceeds export revenues - fell to $38bn in December, its lowest level in 13 months.

The figure, which undershot the $42bn pencilled in by forecasters, reflected a surprise jump in exports of aircraft engines and other industrial goods.

Analysts said US exporters had been helped by the weaker dollar.

"It's an across the board improvement in the US trade gap," said Patrick Fearon at AG Edwards & Sons.

"The US had a smaller trade deficit with every region including China. Perhaps that is in part reflecting the dollar's decline against the euro."

Dollar gains

The dollar has fallen heavily against the euro and other currencies over the last six months, pressured by concerns that the soaring trade gap and a hefty US budget deficit could destabilise the economy.

The shrinking trade deficit will fuel hopes of an orderly adjustment, and raises the prospect of an export-led boost to US economic growth.

The positive trade figures pushed the dollar slightly higher against the euro in midday trade in New York.

They also brightened the mood on Wall Street, where the benchmark Dow Jones share index was up 64 points at 10,492 by about 1820 GMT.

The US economy received another vote of confidence on Wednesday in the Federal Reserve's so-called beige book, a snapshot of economic conditions released eight times a year.

The Fed said the economic environment had continued to improve since its last survey, driven by a buoyant retail sector, stronger manufacturing sector growth, and a robust housing market.

The pick-up was starting to feed through to the labour market, with most regions recording a "modest" increase in job creation, it added.