The US trade deficit expanded in March as the value of imports grew more significantly than exports, signaling strong demand from both consumers and businesses. Data released on Tuesday showed the goods and services trade gap increased by 4.4% from the previous month to reach $60.3 billion. Economists had anticipated a deficit of $61 billion.
Imports rose by 2.3% during the month, largely driven by higher purchases of automobiles and consumer goods. Capital goods imports also hit a record high, supported by strong overseas demand for computer equipment amid a boom in artificial intelligence infrastructure development. The figures were not adjusted for price changes.
Exports grew by 2% compared to the prior month, aided by record shipments of industrial supplies such as crude oil and other petroleum products. Exports of food, feed, and beverages reached their highest level since 2022, while consumer goods exports declined.
The widening trade deficit in March indicates that net exports exerted the largest drag on US GDP growth in a year. Ongoing conflict in Iran, along with the near-closure of the Strait of Hormuz—a vital shipping route handling roughly one-fifth of global oil transport—has introduced new uncertainties into international trade.
The US oil and gas sector stands to benefit from rising crude prices. According to the US Energy Information Administration, American crude exports recently reached an all-time high. Since the outbreak of hostilities involving Iran on February 28, the global benchmark Brent crude price has surged more than 50%.
After adjusting for inflation, the US merchandise trade deficit widened to $90.8 billion in March. Real-time trade figures also revealed that the country’s petroleum trade surplus reached a record high when price adjustments are considered.
On a bilateral basis, the US trade deficit in goods with China expanded for the third consecutive month. Deficits with Canada and Vietnam also grew, while the trade gap with Mexico narrowed slightly.
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