[WASHINGTON] The US trade deficit in February fell sharply to its lowest level since 2009, likely as a labour dispute at one of the country's main ports depressed both imports and exports.

But the smaller deficit, which could see economists raise their first-quarter growth estimates, is probably temporary given a stronger dollar and weaker global demand.

The Commerce Department said on Thursday the trade deficit narrowed 16.9 per cent to US$35.4 billion, the smallest since October 2009.

January's shortfall on the trade balance was revised to US$42.7 billion from a previously reported US$41.8 billion.

Economists polled by Reuters had forecast the trade deficit slipping to US$41.2 billion.

When adjusted for inflation, the deficit narrowed to US$50.8 billion in February from US$54.6 billion the prior month.

The now-settled labour dispute at the West Coast ports appears to have slowed the flow of imports and exports. The strong dollar, weak global demand as well as lower crude oil prices also likely impacted the trade balance in February.

While the smaller trade deficit is positive for gross domestic product, it does little to change views that economic growth slowed sharply in the first quarter.

Growth estimates range between a 0.6 per cent and 1.7 per cent annual pace. The economy grew at a 2.2 per cent pace in the fourth quarter.

In February, imports tumbled 4.4 per cent to US$221.7 billion, the lowest since April 2011. Imports of petroleum products were the lowest since September 2004.

Exports fell 1.6 per cent to US$186.2 billion in February, the smallest since October 2012.

Exports to Canada and Mexico - the main US trading partners - fell in February. Exports to China tumbled 8.9 per cent, while those to the European Union were unchanged.

Imports from China plunged 18.1 per cent, pushing the politically sensitive US-China trade deficit down 21.2 per cent to US$22.5 billion.

REUTERS