In an unexpected turn of events, the U.S. trade deficit has narrowed significantly, reaching its lowest level since 2020. The trade deficit dropped to $52.8 billion in September, marking a decrease of $6.4 billion from the previous month. This improvement is primarily attributed to a surge in exports, which hit a five-month high, and ongoing tariff impacts that have dampened demand for imports. Analysts note that while the narrowing trade gap is positive, it may not translate into a substantial boost for the third quarter GDP.