The US trade deficit widened in February as a rebound in imports offset strong growth in exports, which increased to a record high, potentially keeping trade on track to subtract from economic growth in the first quarter.
The trade gap increased 4.9 percent to US$57.3 billion, the Commerce Department's Bureau of Economic Analysis and Census Bureau said on Thursday. Data for January was revised to show the deficit narrowing to US$54.7 billion instead of US$54.5 billion as previously estimated. Economists polled by Reuters forecast the trade deficit rising to US$61.0 billion in February.
The BEA and Census Bureau are still catching up on data releases following last year's government shutdown. Trade data continues to be volatile amid shifting policy.
The US Supreme Court in February struck down President Donald Trump's broad tariffs, which he pursued under a law meant for use in national emergencies. Trump, however, responded by imposing a global tariff for up to 150 days.
Trump has defended the tariffs as necessary to address the trade deficit and revive the nation's industrial base, though 100,000 factory jobs have been lost since January 2025.
Economists expect the US-Israeli war with Iran, which has led to shipping restrictions impacting goods ranging from energy products to fertilizers through the Strait of Hormuz, to reduce trade volumes.
Imports increased 4.3 percent to US$372.1 billion in February. Goods imports rose 5.0 percent to US$291.5 billion. They were boosted by imports of capital goods, which increased US$7.8 billion, mostly reflecting computers, computer accessories and semiconductors. These imports are likely linked to artificial intelligence and the construction of data centers.
Imports of industrial supplies and materials increased US$3.1 billion, mostly lifted by crude oil. Consumer goods imports rose US$2.2 billion amid a US$1.0 billion increase in pharmaceutical preparations. Imports of automotive vehicles, parts and engines increased US$1.6 billion.
Exports jumped 4.2 percent to a record high US$314.8 billion. Goods exports soared 5.9 percent to an all-time high of US$206.9 billion.
Exports of industrial supplies and materials increased US$10.2 billion to a record high, driven by monetary gold and natural gas. Exports of non-petroleum goods were also the highest on record.
The goods trade deficit widened 3.0 percent to US$84.6 billion in February. When adjusted for inflation, the goods deficit increased US$0.5 billion, or 0.6 percent, to US$83.5 billion.
Trade subtracted from gross domestic product growth in the fourth quarter. The Atlanta Federal Reserve is forecasting GDP increasing at a 1.9 percent annualized rate in the first quarter. The economy grew at a 0.7 percent pace in the fourth quarter.
The goods trade deficit with China increased to US$13.1 billion in February from US$12.5 billion in January, while the shortfall with Mexico swelled US$4.1 billion to US$16.8 billion.
Exports of services increased US$1.1 billion to a record US$107.9 billion amid rises in travel, other business services, financial services and charges for the use of intellectual property. But exports of transport services fell.
Imports of services jumped US$1.3 billion to an all-time high of US$80.6 billion, boosted by charges for the use of intellectual property.
Reuters
