WASHINGTON: The U.S. trade deficit in goods widened sharply in January, most likely as businesses front-loaded imports ahead of tariffs, potentially positioning trade to be a drag on economic growth in the first quarter.
The goods trade gap surged 25.6% to $153.3 billion last month, the Commerce Department’s Census Bureau said on Friday. Goods imports vaulted 11.9% to $325.4 billion.
President Donald Trump in his first month in office has issued a raft of tariff orders.
US, China economic leaders raise ‘serious concerns’ in first call
On Thursday, Trump said a 25% tariff on Mexican and Canadian goods would take effect on March 4, after being delayed for a month, along with an extra 10% duty on Chinese imports, on top of 10% already imposed. Other duties aimed at imported steel, aluminum and motor vehicles will either soon go into effect or are in fast-track development.
Exports rose 2.0% to $172.2 billion last month.
Trade contributed to the economy’s 2.3% annualized growth rate in the fourth quarter.
Comments