WASHINGTON — The falling dollar has halted the decline in U.S. competitiveness in world markets, but future improvements in the trade situation are up to American business, a top Reagan Administration official said Monday.
Trade Representative Clayton K. Yeutter said the decline in the value of the dollar in exchange markets had succeeded in making U.S. goods price competitive with foreign-made goods.
But he said the question of whether the American-made goods will now sell well around the world would be determined by the service and the quality of the goods offered.
"If our exports do not begin to accelerate, then it seems to me that the businessmen and exporters of this country must search their souls," Yeutter said in an address to an American Stock Exchange conference here.
Citing the recent shift in the dollar's value relative to other key currencies such as the Japanese yen and West German mark, he said: "Those are incredible shifts, which clearly do make our own products much more internationally competitive pricewise."
Yeutter said the lower value of the dollar had made U.S. prices competitive on literally hundreds of thousands of products today. "The profit opportunities are surely there with a whole lot of products and services," he said.
Yeutter said government measures of trade performance show that the U.S. trade deficit has topped out in recent months and has begun to slowly decline. The question facing U.S. economic policy-makers was how to accelerate that decline.
As measured by the Commerce Department, the U.S. trade picture improved slightly during the first quarter of 1987 as the current account deficit narrowed to $37.12 billion from a record $37.97 billion during the fourth quarter of 1986.
The current account, which grew every quarter during 1986, is the broadest government measure of American trade performance, including financial transactions with the rest of the world and investment flows as well as trade in goods and services. The improvement in the current account was foreshadowed by earlier reports of declines in the deficit in merchandise trade in March and April.
The deficit in merchandise trade, a narrower measure of trade performance, was a record $166.3 billion in 1986.