US trade gap likely widened slightly in May but stayed below three-year high hit in March

The Commerce Department reports on the trade gap for May at 8:30 a.m. Eastern Tuesday.

WIDER DEFICIT: Economists think the deficit widened by just under $2 billion, to $42.8 billion in May, according to a survey of economists by data firm FactSet.

TRADE GAP: In April, the trade deficit narrowed sharply after big jump to $50.6 billion in March. Even with a slight increase for May, the deficit would still be well below March when it hit the highest levels in three years.

Trade slashed nearly 2 percentage points off growth during the first three months of the year. Combined with other problems that arose from an unusually severe winter, the economy went into reverse and contracted at an annual rate of 2 percent in the first quarter.

Analysts believe that a narrowing of the trade deficit in the April-June period will be a major factor in reviving overall growth, which they believe rebounded to an annual rate in the spring of around 2.5 percent, as measured by the gross domestic product.

Analysts think going forward that solid job gains will help bolster GDP growth even more in the second half of this year to around 3 percent.

President Barack Obama won a hard-fought trade victory last month when Congress finally passed the fast-track legislation he needed to wrap up negotiations on a trade agreement with 11 Pacific nations.

Obama, who has bucked many in his own political party to win approval, said the 12-nation Trans-Pacific Partnership trade agreement, which the administration hopes to complete later this year, will be good for American workers and American businesses because it will open up export opportunities for U.S. companies.

Critics say the legislation Obama signed into law on June 29 did not go far enough to ensure strong enforcement of labor and environmental standards and will not hold countries responsible if they manipulate their currency to gain unfair trade advantages.