THE United States' trade deficit with China slid in November last year, falling US$534 million to $2.12 billion. This compares with a deficit for $2.65 billion for October. The reduction in the US trade deficit with the mainland gives a further boost to Sino-US relations following the signing of a new textile agreement on Monday. Against this background, the chances for renewal of China's Most Favoured Nation trade status are seen as higher. The US trade deficit with Hong Kong also shrank, dropping $10.9 million to $145.1 million. There was also a reduction in the deficit with Japan, down to $5.72 billion from $6.09 billion in October. The overall trade deficit fell slightly to $10.17 billion, helped by a big drop in foreign oil prices and lower car imports, the Government said yesterday. The Commerce Department said the merchandise trade deficit fell 6.7 per cent to its lowest level since August. Imports fell 1.5 per cent, reflecting the cheapest oil prices in five years, but exports were down as well, falling 0.1 per cent. Even with the improvement, the US was certain to suffer its worst trade performance since 1988. Through the first 11 months of last year, the country was running an annual deficit of $118.5 billion, 40 per cent higher than the $84.5 billion deficit recorded in 1992. Analysts have said this year's figure is likely to worsen further as an improving US economy draws in higher levels of imports while US manufacturers continue to be battered by significant economic weakness in their major overseas markets. The biggest factor affecting November's figure was a substantial drop in foreign oil prices, which fell 91 cents a barrel to an average of $13.69 for the month, the lowest monthly average since December 1988. Imports totalled $50.24 billion in November, down $754 million from a record level set in October, while exports totalled $40.07 billion, a drop of $25.6 million from the October level, which was also a record.