A year of unpredictable tariff policies came to a head in December when the US trade imbalance grew.
According to Commerce Department figures released Thursday, the goods and services trade gap widened from the previous month to $70.3 billion. The deficit amounted to $901.5 billion for the entire year, which is still among the highest since 1960.
The December deficit was a result of imports rising by 3.6%. Goods and services exports fell 1.7%. A Bloomberg survey of experts yielded a median forecast of a $55.5 billion total deficit.
Month-to-month, the trade data in 2025 was particularly erratic as US importers responded to President Donald Trump’s constant barrage of tariff pronouncements. As businesses rushed to avoid additional tariffs, imports of gold and pharmaceuticals were especially erratic.
The December increase in goods imports includes increases in motor vehicles and computer equipment. According to the trade data, the drop in exports was mostly due to a decrease in gold shipments.
With the release of the fourth quarter gross domestic product on Friday, economists will be able to solidify their projections with the aid of the most recent trade data. Prior to the data, net exports were predicted by the Federal Reserve Bank of Atlanta’s GDPNow to contribute roughly 0.6 percentage points to fourth-quarter growth, which is currently projected to be 3.6%.
The merchandise trade imbalance increased to $97.1 billion in December, the most since July, after accounting for price fluctuations that affect the real GDP calculation. Gold trade is not included in the government’s GDP calculation unless it is utilized for industrial processes like making jewelry.
As part of his plan to boost domestic investment, lessen dependency on imports, and reverse decades of industrial job losses, Trump has relied on tariffs. He and his economic staff have disputed studies that found tariffs had lost Americans money.
US businesses imported more computers and accessories this year—nearly $145 billion—than they did in 2024. The significant investment being made in artificial intelligence was reflected in the surge in demand.
Last year, the imbalance between the two countries increased to a record $146.8 billion. As a result of Trump’s increased tariffs on Chinese imports, the deficit with China, on the other hand, shrank significantly, to roughly $202 billion, the lowest in over two decades.
The annual gap with Canada decreased, but the deficit with Mexico grew to a record. US initial jobless claims dropped last week by the most amount since November, according to separate data released Thursday.
