The U.S. trade deficit fell 11.9 percent to $73.8 billion in October 2024, down from $83.8 billion in September, according to the latest data from the U.S. Bureau of Economic Analysis (BEA). Exports declined 1.6 percent to $265.7 billion while imports fell 4 percent to $339.6 billion, marking the biggest decrease since November 2022.
The decline in the trade deficit in October reflected a decrease in the goods deficit of $10.4 billion to $98.7 billion and a decrease in the services surplus of $0.4 billion to $24.8 billion. Year-to-date, the U.S. trade deficit increased $80.7 billion or 12.3 percent from the same period in 2023. Exports increased $94.0 billion or 3.7 percent while imports increased $174.7 billion or 5.4 percent.
Trump’s potential tariff hikes raise worries
In October, the U.S. exports of capital goods, computer accessories, automotive vehicles and their parts, passenger cars and industrial supplies all declined while exports of services including travel, business services, transport, maintenance and telecommunications rose. Meanwhile, imports of goods including computers, semiconductors, industrial supplies, crude oil and automotive vehicles fell while imports of services rose.
Trade subtracted 0.57 percentage points from GDP in the July-September quarter. It has impacted economic growth for three straight quarters. The economy grew at a 2.8 percent annualized rate in the July-September quarter.
As the country’s trade deficit began to narrow, businesses worried about President-elect Donald Trump’s threats to raise tariffs on foreign goods which would reverse October’s drop and ensure that trade keeps impacting the gross domestic product. Trump has said he would impose a 25 percent tariff on all products from Mexico and Canada and an additional 10 percent tariff on goods from China on his first day in office.
Read: China’s industrial profits top $814 billion in Jan-Oct
U.S. trade deficit with EU, Vietnam dips
The BEA also revealed that the U.S. recorded a trade surplus with the Netherlands, South and Central America, United Kingdom, Hong Kong, Australia, Brazil, Belgium, Singapore and Saudi Arabia. Meanwhile, it recorded a deficit of $25.5 billion with China, $17.1 billion with the European Union, $15.4 billion with Mexico and $4.4 billion with Canada.
The U.S. trade deficit with the European Union decreased by $6.7 billion to $17.1 billion in October. Exports increased $30.6 billion while imports decreased to $47.8 billion. The deficit with Vietnam also declined to $10.6 billion in October. Meanwhile, the deficit with Switzerland increased to $3.7 billion in October.
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