The United States’ trade deficit exhibited a decline by $74.7 billion in April, fueled by President Donald Trump’s “Reciprocal Tariffs” policy and the ensuing economic uncertainty brought by tariff fears.
The trade figure stood at $87.6 billion, the lowest since September 2023. This marked a sharp decline from March, which saw companies rushing to import goods to stockpile before the tariffs came into effect, which resulted in a record high trade deficit.
Furthermore, goods imports slumped by $68.4 billion to $276.1 billion in April, which also marked the biggest month-on-month decrease on record, underpinned by the tariffs. Additionally, goods imports in April also fell 19.8% as U.S. trade with many of its partners ground to a halt due to tariffs concerns.
Meanwhile, exports soared to $188.5 billion in April, a $6.3 billion jump, which is also an all-time high.
Revenue from tariff also hit a record $22.3 billion in May, following $16.5 billion collected in April, with more than doubled customs and excise taxes levied over the same period. Tariffs now contribute 4% of U.S. total federal revenue, a significant increase from average 2% in the last few years, and are set to rapidly increase in the future.
President Trump aims to utilize the tariffs as a means to both extract pro-American trade deals, as well as reduce the nation’s enormous trade deficit. As seen in the last two months, tariffs have significantly reduced the amount of goods into the U.S., while exports flourished as countries rushed to offer new trade deals to stave off tariffs, closing the country’s trade gap.
