The US trade deficit narrowed by 0.2pc in 2025, a year marked by US president Donald Trump's reordering of the world trading system through on-again, off-again tariffs that contributed to a slump in the dollar.
For full-year 2025, the deficit in goods and services was $901.5bn, down from $903.5bn in 2024, the Bureau of Economic Analysis reported Thursday. Exports were $3.432 trillion, up by 6.2pc, or $200bn, from a year earlier, while imports were $4.339 trillion, up by 4.8pc, or $197.8bn, from 2024 levels.
Trump took office in January vowing to strike back at trading partners — both allies and adversaries — he claimed had been "ripping off" the US for decades. He announced massive tariffs but subsequently delayed or revoked some of them as he sought leverage for sometimes unrelated deals. This helped to drive down the value of the dollar and unravel longstanding US relationships, most importantly with traditional allies like the EU and Canada.
The trade-weighted dollar has depreciated by nearly 2pc this year following an 8pc depreciation last year, according to Oxford Economics. A weaker dollar supports US exports.
The trade deficit peaked at $923bn in 2022, up from $837bn the prior year, then fell to $774bn in 2023. It ranged from $491bn in 2015 to $646bn in 2020, according to Commerce data.
Goods and services
Exports of goods increased by $119bn to $2.198 trillion in 2025 from the prior year. Exports of services increased by $81bn to $1.235 trillion.
Exports of capital goods increased by $64bn, led by civilian aircraft and parts and computers and accessories. Industrial supplies exports rose by $56bn, led by shipments of non-monetary gold. Exports of automotive vehicles and parts decreased by $17bn.
Imports of goods increased by $143bn to $3.438 trillion. Imports of capital goods rose by $166bn, led by computers and accessories. Industrial supplies imports were by $23bn, with crude imports down by $27bn. Automotive vehicles and parts imports were down by $52bn.
Petroluem trade
US petroleum exports were at $254bn last year, the lowest since 2021, while imports of $197bn were the lowest since 2020.
The US posted deficits of $219bn with the EU, $202bn with China, $197bn with Mexico, $178bn with Vietnam, $147bn with Taiwan and $73bn with Canada last year. It also posted deficits with Ireland, Germany, Japan, India, South Korea, Indonesia and France.
The US showed surpluses of $61bn with Netherlands, $52bn with South and Central America — including $14bn with Brazil — $32bn with the UK, and $28.5bn with Hong Kong and last year.
The average US tariff rate on imports rose to 13pc by the end of last year from 2.6pc at the beginning of the year, amid the on-again, off-again levies from the US administration, according to a Federal Reserve Bank of New York study released earlier this month. In recent years, following earlier rounds of tariffs, China's share of US imports fell to less than 10pc from nearly 25pc in 2017. Mexico and Vietnam gained market share.
US firms and consumers bear the brunt of the economic burden from the tariffs, the New York Fed study said.
December
The deficit widened by 32.6pc to $70.3bn in December from $53bn in November.
Exports fell by 1.7pc to $287bn while imports rose by 3.6pc to $358bn.
