US trade deficit hits 10-year high in 2018

Ongoing surge in imports defies Donald Trump’s election pledge to rein in deficit

The gap between US imports and exports widened in 2018, bringing the country's trade deficit to more than $600 billion (€530 billion) and a 10-year high in a blow to the ambitions of Donald Trump to tackle the imbalance.

The goods and services deficit rose $68.8 billion (€60.8 billion) to $621 billion (€549.2 billion) last year, according to the US Census Bureau, as strength in the economy continued to fuel demand for imports.

It was the widest figure since 2008, when the deficit hit $709 billion (€627 billion).

The report defies one of Mr Trump’s key campaign promises to enact trade policies that would shrink the deficit. The higher deficit was driven by a strong US economy, which boosted purchases of imported goods, but also retaliatory levies on US exports, which made it harder for companies to sell abroad.


All-time high

Exports totalled $2.5 trillion (€2.21 trillion), an increase of $148.9 billion (€131.7 billion) year on year. Imports were up $217.7 billion (€192.5 billion) at more than $3.1 trillion (€2.7 trillion).

Data also showed that the US’s deficit in goods expanded 10.4 per cent to $891.3 billion (€788.3 billion), an all-time high. Its surplus in services grew 5.9 per cent to $270.2 billion (€238.9 billion).

The trade deficit with China, which is locked in trade negotiations with Washington, increased $43.6 billion (€38.5 billion) to $419.2 billion (€370.7 billion) last year.

– Copyright The Financial Times Limited 2019