THE country's trade deficit narrowed in June from a month earlier as both imports and exports fell, preliminary data from the Philippine Statistics Authority (PSA) showed on Tuesday.

At $4.3 billion, the shortfall was smaller than the $4.7 billion posted in May but rose from $3.9 billion a year earlier.

Total trade in goods fell to $15.43 billion for the month from May's $17.37 billion and the $17.40 billion recorded in June 2023.

Imports hit $9.87 billion, down from $11 billion in May and the year-earlier $10.67 billion. Exports also fell to $5.57 billion from $6.3 billion a month earlier and from June 2023's $6.7 billion.

Imports accounted for 63.9 percent of total external trade in June, with the rest taken up by outbound shipments.

Year to date, exports grew to $36.4 billion from $35.3 billion in the comparable 2023 period.

Imports, on the other hand, were lower at $61.4 billion for the January-May period compared to $22.96 billion a year earlier.

Electronics remained the country's top export, accounting for $2.99 billion or 53.7 percent of total exports in June.

Manufactured goods and mineral products followed at $285.56 million and $252.03 million, respectively.

The United States was the biggest buyer of Philippine-made goods during the month, having purchased $897.8 million or 16.1 percent of total exports.

Rounding out the top five were Hong Kong ($886.64 million or 15.9 percent), China ($868.4 million or 15.6 percent), Japan ($746.97 million or 13.4 percent) and Korea ($240.26 million or 4.3 percent).

Electronic products were also the Philippines' biggest import for June at $2.23 billion or 22.6 percent of the total.

Mineral fuels, lubricants and related materials followed at $1.57 billion (15.9 percent), and transport equipment ($787.9 million, 8 percent) was third.

China was the country's biggest supplier, providing $2.6 billion worth of goods or 26.3 percent of total inbound shipments.

It was followed by Indonesia ($861.69 million or 8.7 percent), Japan ($763.2 million or 7.7 percent), Korea ($715.14 million or 7.2 percent) and the USA ($658 million or 6.7 percent).

Commenting on the latest merchandise trade data, Pantheon Macroeconomics chief economist Miguel Chanco said the month-on-month narrowing of the trade deficit was expected, mainly due to seasonal changes in exports and imports returning to normal.

He noted that the drop in exports, the worst in 14 months, was partly due to seasonal and base effects from last year, while the decline in imports, especially in consumer goods, suggests weak domestic demand.

"Both capital and consumer goods imports are currently struggling to build any meaningful upward momentum, underscoring the current weakness in domestic demand," Chanco said.

However, he added that the stability in Korean export growth might boost Philippine exports in the second half of the year.