Trade gap widens beyond expectations in U.S.
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As a result of a rush to beat another wave of President Donald Trump's tariffs, the US trade deficit expanded more than expected in July, government data showed Thursday.
In July, the U.S. trade deficit increased by 32.5 percent to $78.3 billion, according to the Department of Commerce.
Imports rose by 5.9 percent to $358.8 billion, while exports increased by 0.3 percent to $280.5 billion.
The deficit exceeded a Briefing.com consensus forecast of $64.2 billion.
Pantheon Macroeconomics analysts suggest the widening trade gap may be related to pre-tariff inventory accumulation, according to a recent report.
In April, a 10-percent tariff was imposed on a large number of U.S. trading partners, and subsequent plans to increase these tariffs for numerous economies were postponed twice.
The increased tariffs for major partners, including the European Union, Japan, and India, were implemented in early August.
It is believed that companies that increased imports to avoid tariff increases are now depleting existing inventory, potentially leading to new purchases at higher costs.
The Commerce Department report noted increases in imports of industrial supplies and consumer goods.
The U.S. goods deficit with China increased by $5.3 billion to $14.7 billion in July, according to the report.
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