The U.S. trade deficit plunged in January to the lowest level in six years.

U.S. exports — from farm goods to autos to civilian aircraft — fell sharply, while imports fell at an even faster clip as a deepening recession cut demand for goods from abroad.

The Commerce Department said Friday the trade imbalance dropped to $36 billion US in January, a decline of 9.7 per cent from December and the lowest level since October 2002.

The imbalance was slightly better than the $38 billion US deficit that economists had expected.

Imports were down because of the severe recession, already the longest in a quarter-century, and the spreading weakness globally cut even further into U.S. exports, which had up until recently been one of the few bright spots for the economy.

U.S. manufacturers are confronted with a darkening picture in which demand for their products is dropping sharply not only at home but also in foreign markets.

For January, exports of goods and services fell 5.7 per cent to $124.9 billion US. It was the sixth straight month that exports have fallen, pushing them down to the lowest level in more than two years.

The reason that the trade deficit narrowed was that imports fell even more sharply in January, declining by 6.7 per cent to $160.9 billion US, the lowest level for imported goods since March 2005. The decline in imports was led by a 25.2 per cent drop in imported crude oil, which fell to $11.9 billion US in January with both the level and the average per barrel price hitting to three-year lows.

Economists called the export decline alarming, predicting that it would add to the woes of an economy that was already shrinking at the fastest pace in a quarter-century.