The U.S. trade deficit widened by 24.4% in July to $88.6 billion, the Commerce Department’s Bureau of Economic Analysis reported on Thursday. The figure exceeded the $90.0 billion shortfall forecasted by economists polled by Reuters and reflected a broader imbalance in goods trade.
The goods trade deficit, which excludes services, increased by 17.3% to $119.6 billion. After adjusting for inflation, the deficit rose 12.7% to $106.4 billion. The shortfall subtracted 1.14 percentage points from U.S. gross domestic product growth in the April–June quarter, when the economy expanded at a 1.5% annualized pace.
Imports climbed 2.8% to $399.3 billion, with goods shipments up 3.7% to $320.6 billion. Capital goods imports surged by $14.4 billion to a record $140.3 billion, driven by higher purchases of computers, accessories, and semiconductors. Industrial supplies and materials imports, including petroleum, fell by $1.8 billion, while crude oil imports declined by the same amount amid lower prices. Services imports dipped $0.6 billion to $78.7 billion.
Exports declined 2.1% to $310.7 billion, with goods shipments down 3.0% to $201.0 billion. Industrial supplies and materials exports fell $8.7 billion, largely due to lower crude oil and nonmonetary gold shipments, which are excluded from GDP calculations. Capital goods exports rose $1.9 billion, while consumer goods exports increased $1.7 billion, boosted by pharmaceutical preparations. Services exports edged down $0.4 billion to $109.7 billion.
The U.S. recorded record goods trade deficits with Mexico, Vietnam, Taiwan, Thailand, South Korea, and Malaysia in July. The trade balance with Switzerland shifted into deficit, while the shortfall with Canada narrowed by $3.7 billion to $3.2 billion amid ongoing trade tensions between the two countries.
