The US trade deficit experienced a significant jump in September, as imports of goods escalated while exports of both goods and services witnessed a decline, as reported by government data. The goods and services deficit grew by 19% month over month to reach $84.36 billion, with recent analysis from the Census Bureau and the Bureau of Economic Analysis.
The expected consensus indicated a deficit of $84 billion, as compiled from a Bloomberg survey. Furthermore, the August deficit was revised slightly upwards to $70.79 billion. Total imports saw a 3% increase, totaling $352.31 billion, whereas exports saw a decrease of 1.2%, settling at $267.95 billion for September, per the official statistics.
Domestic demand has been cited as a significant driver of import growth, and analysts from Oxford Economics project a 0.55 percentage-point drag on third-quarter gross domestic product due to trade issues. "We foresee imports outpacing exports in the near term as investments in data centers and semiconductor production enhance capital goods imports.
Additionally, strong consumer demand urges retailers to stock up their inventories," highlighted Matthew Martin, Senior US Economist at Oxford, in communications sent to MT Newswires. Imports of goods rose to $285.02 billion from $274.08 billion, largely propelled by both consumer and capital goods demand.
The official report indicates that a surge in computer and semiconductor requirements significantly elevated the capital goods figures. Conversely, exports of goods decreased to $176.03 billion from $179.25 billion, attributed primarily to a downturn in capital goods reflecting waning demand for civilian aircraft. On the services front, imports shrank to $67.29 billion from $67.89 billion, while service exports slightly dipped to $91.92 billion in September from $91.94 billion in the preceding month. In a notable context on this day, Americans are heading to polling stations to elect the nation's next president, with Democratic Party nominee and current Vice President Kamala Harris vying with Republican Party nominee and former President Donald Trump. "The election results could potentially elevate import risks if importers take preemptive actions against possible tariff increases should Trump win the presidency," Martin added. Year-to-date figures reveal that through September, the overall goods and services deficit has surged by 11.8% compared to the same timeframe in 2023, as noted by the Bureau of Economic Analysis and the Census Bureau..