The US trade deficit narrowed to its narrowest level since 2023, with the main reason being a decline in imports.

Due to many businesses cutting back on purchases following a large-scale import wave at the beginning of the year, the US trade deficit in June narrowed to its lowest level since September 2023. Data released by the US Department of Commerce on Tuesday showed that the trade deficit for goods and services in June shrank significantly by 16% from the previous month, falling to $60.2 billion. Economists surveyed by Bloomberg had a median forecast of a deficit of $61 billion. The data showed that total imports decreased by 3.7%, primarily due to a decline in the value of imported goods to the lowest level since March 2024; however, exports contracted at a relatively smaller rate. The data was not adjusted for inflation. Imports of consumer goods fell to their lowest level since September 2020, while imports of industrial goods and automobiles also declined, although imports of capital equipment increased slightly. The report indicated that US businesses had stockpiled heavily before President Donald Trump announced large-scale tariff increases on April 2, and this situation may now be gradually fading. The suspension or reduction of many tariffs has also given businesses more breathing space to purchase more foreign goods during this period. These data marked the end of the second quarter. According to preliminary data released by the US Department of Commerce last week, the US economy grew at an annualized rate of 3% in the second quarter. Net exports contributed 0.5 percentage points to the gross domestic product (GDP), compared to dragging down GDP by nearly 5 percentage points in the first quarter. Behind the seemingly strong data, the actual momentum of the economy is weakening. Last week, the White House announced adjusted tariff rates on countries that have not reached a trade agreement with the US by the deadline of August 1. Trump is expected to announce separate tariffs in the coming weeks for imports of pharmaceuticals, semiconductors, critical minerals, and other important industrial products, which could further disrupt the international trade landscape.