US trade gap widens to $74.6 billion, largest since October 2022

The US trade deficit widened in April to the largest since October 2022 on a surge in imports of goods including motor vehicles, computers and industrial supplies.

The gap in goods and services trade grew 8.7% from the prior month to $74.6 billion, Commerce Department data showed Thursday. The median estimate in a Bloomberg survey of economists called for a $76.5 billion gap.

The value of imports rose 2.4% to the highest since mid-2022, while exports edged up 0.8%. The figures aren’t adjusted for inflation.

The April deficit suggests trade will again be a constraint on economic growth after subtracting from gross domestic product in the first quarter for the first time since early 2022. Prior to the latest results, the Federal Reserve Bank of Atlanta’s GDPNow forecast showed trade subtracting about a half a percentage point in the second quarter.

While the US trade balance has improved since 2022, the appetite for imported merchandise may stay elevated given resilient consumer spending. Moreover, softer overseas economies are restraining demand for US exports.

On an inflation-adjusted basis, the merchandise trade deficit widened to $93.5 billion in April, the largest in a year.

The trade report included annual revisions back to 2019.

Digging Deeper

• Travel exports — or spending by visitors to the US — fell 1.7% to a three-month low
• Travel imports — a measure of Americans traveling abroad — eased for a second month
• The US merchandise-trade deficit with China narrowed. The value of goods imported from China declined
• The goods shortfall with Mexico also narrowed, on a Census basis