The US trade deficit widened to a record high in March as businesses boosted imports of goods ahead of tariffs, which dragged gross domestic product into negative terrain in the first quarter for the first time in three years.
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The trade gap jumped 14.0 per cent to a record US$140.5 billion from a revised US$123.2 billion in February, the Commerce Department’s Bureau of Economic Analysis (BEA) said on Tuesday. This was the widest deficit for a month on record, dating back to 1992.
Economists had forecast the trade deficit rising to US$137.0 billion from the previously reported US$122.7 billion in February.
President Donald Trump’s “Liberation Day” tariffs, including raising duties on Chinese imports to a staggering 145 per cent, fuelled a rush by businesses to bring in merchandise to avoid higher costs.
While reciprocal tariffs with most of the United States’ trade partners were suspended for 90 days, duties on Chinese goods came into effect in early April, triggering a trade war with Beijing.
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Imports vaulted 4.4 per cent to an all-time high US$419.0 billion in March. Goods imports soared 5.4 per cent to a record US$346.8 billion. Exports climbed 0.2 per cent to US$278.5 billion, also a record high. Exports of goods increased 0.7 per cent to US$183.2 billion.