In March, the U.S. trade deficit soared to record highs in March as President Donald Trump's leading purchases before imposing tariffs on imports.
According to the U.S. Census Bureau, the gap between imports and exports widened to $16.2 billion in March, from $92.8 billion in 2024, marking the highest figure extending to the early 1990s.
The rise in the trade balance is almost entirely dependent on a surge in imports, especially those with a longer shelf life, such as automobiles, industrial materials and consumer goods.
These figures have increased reports that U.S. businesses have significantly increased their inventory before the Trump administration introduced steep tariffs.
“Overall (Q1 2025) remains that President Trump’s tariff threats have made it rush to buy goods now rather than face higher prices later, which has prompted a shocking pace of imports,” said Oliver Allen, senior economist at Pantheon macroeconomics.
The U.S. president launched a series of so-called reciprocity tariffs on April 2, triggering a huge sell-off in the stock market and increasing the U.S. government's financing costs as investors' high tariffs will put the U.S. economy into a recession and risk of hindering global growth.
Despite the introduction of many tariffs on April 4 for 90 days, the baseline still exists 10%, and the tax on most Chinese imports is also 145%. Even without the April 2 tariffs, the current situation makes the U.S. trade responsibility the most efficient in more than a century, economists say.
The report advances the first estimate of first-quarter GDP, which will be released on Wednesday and is expected to be distorted by the impact of the pre-load.
Reuters predicted annualized quarterly growth of just 0.3%, down from 2.4% in the fourth quarter of last year.
But economists say the numbers could paint too negative situations in U.S. growth.
“GDP numbers will rarely tell us,” said Isabelle Mateos Y Lago, chief economist at BNP Paribas. “It will be full of noise and largely reflect the sum of imports.”
“You’re going to really look at the hood to see what’s actually happening,” she added.
Economists expect some shift in the second quarter as imports fall and dive GDP.
"Today's (trade) figures do emphasize the risk that it is likely to be negative GDP prints, which is clearly to make us a very weak risk in 2025," said James Knightley, chief international economist at Ing Bank.
West Coast ports, such as Los Angeles, reported a sharp decline in cargo volumes in recent weeks, suggesting that ships carrying products from China’s east coast are regressing.
Anecdotal reports about shortages of construction and industrial products from China have also begun to emerge.
Other reports by George Steer in New York