The US trade deficit narrowed more than expected in July, but was still the second highest on record at $50.1 billion.
The figures from the US Commerce Department showed that imports dropped for the first time in 10 months while and exports moved higher.
The trade gap declined nearly 9% from a revised estimate of $55 billion in June for the biggest monthly decline since December 2001.
The near record deficit could renew pressure on the dollar, which has traded in broad range between about $1.175 and $1.245 against the euro over the past six months.
On Thursday, San Francisco Federal Reserve Bank President Janet Yellen said any turnaround in the US trade deficit must involve the dollar.
Imports dipped 1.4% to $146 billion. A drop in oil import prices to $33.28 per barrel after eight consecutive monthly increases helped lower the overall import bill.
Exports increased 3% to $95.9 billion, just $1 billion short of the record set in May. The rebound included an increase in civilian aircraft sales, which had fallen sharply in June and helped pushed the trade deficit to a record that month.
Meanwhile, the politically sensitive US trade deficit with China set another monthly record at $14.9 billion as imports increased 3.7% from June and exports fell 2.6%. US manufacturers blame China's policy of pegging its currency against the dollar for the soaring bilateral deficit.
