"The merchandise trade deficit is the gap between what the US imports and what it exports. Exports are ""free alongside ship."" Imports include customs.</br></br>The U.S. merchandise trade deficit narrowed sharply in January to $9.49 billion, the smallest in three months, as a big decline in consumer imports offset a higher oil bill, the Commerce Department reported yesterday.</br></br>The department said the imbalance between imports and exports fell by 13.7 percent from a revised December deficit of $10.99 billion as the United States posted a rare trade surplus with Europe and the deficit with Japan fell to its lowest point in 1'h years.</br></br>The Bush administration hailed the development as an encouraging sign of progress in whittling down the countryÛªs huge trade deficit.</br></br>But many private economists were far less encouraged. Some called the January figure a one-month fluke in what they believe will"