Washington (AFP) – President Donald Trump’s tariff hikes on dozens of trading partners hit US imports in August, according to a Wednesday report delayed by a record government shutdown that ended last week. The 43-day stoppage had paused publications of federal economic data ranging from inflation numbers to retail sales, although reports are starting to trickle out again — with key September employment figures due Thursday.
In August, the overall US trade deficit narrowed more than analysts expected, reaching $59.6 billion on a notable drop in goods imports. “New trade policy changes came online in August,” including tariff hikes targeting dozens of US trading partners, said KPMG senior economist Meagan Schoenberger. “Wholesalers drained inventories to compensate for lower imports,” she added in a note.
Imports declined 5.1 percent to $340.4 billion, with goods imports decreasing $18.6 billion. Among sectors that saw pullbacks were industrial supplies and materials, alongside consumer products. Exports edged up 0.1 percent to $280.8 billion due to an uptick in services, but the value of goods exports similarly fell.
Trade flows have been heavily swayed this year by President Donald Trump’s fast-changing tariff policies, with importers rushing to stock up on inventory ahead of planned hikes in duties. “We expect continued uncertainty because of ongoing legal challenges and trade negotiations,” Schoenberger added. She flagged that the United States still has many national security-related investigations underway, which could lead to new tariffs, and potential exemptions in the pipeline.
These “could lead to new rounds of stocking up and draining inventories,” she said. Since returning to the presidency, Trump has imposed fresh duties on various economies, including so-called “reciprocal” tariffs on virtually all US trading partners over practices that Washington deems unfair. Trump also engaged in a tit-for-tat tariffs escalation with China, the world’s second biggest economy, with rates reaching prohibitive triple-digit levels in April — snarling trade. Among countries, the US goods deficit with Canada shrank in August, as did that with China.
© 2024 AFP
