The US trade deficit narrowed in June, driven by a sharp drop in consumer goods imports and the largest decline in its trade gap with China since 2004. The Commerce Department reported that the overall trade gap shrank 16.0% to $60.2 billion.
Consumer goods imports plummeted, contributing to the reduced deficit. Exports of goods and services totaled $277.3 billion, down from May’s figure of $278 billion, while total imports fell to $337.5 billion, down from $350.3 billion in May.
The narrowed trade gap has contributed to the US economy’s rebound in the second quarter, with GDP expanding at a 3.0% annualized rate. However, underlying indications suggest that activity is weakening.
US President Donald Trump has set new tariffs on imported goods, which are expected to kick in on August 7 and raise the average tariff rate to 18.3%. The US-China trade gap has narrowed by $22.2 billion over five consecutive months, with imports from China dropping to $18.9 billion, the lowest since 2009.
US-China trade negotiators met last week and recommended that Trump extend an August 12 deadline for current tariff rates to expire. Trump expressed optimism about the talks, stating that “we’re getting very close to a deal” and that relations with China are improving.
Source: https://www.cnbc.com/2025/08/05/us-trade-deficit-narrows-to-60point2-billion-in-june.html