The US trade deficit ballooned to $88.6 billion in July, a 24.4% jump from June’s revised figure of $71.2 billion. It’s the widest gap between what America buys and what it sells since March 2025, and the speed of the deterioration caught attention across markets.
The data, released September 3 by the Bureau of Economic Analysis and the Census Bureau, showed a two-sided squeeze. Exports dropped 2.1% to $310.7 billion while imports climbed 2.8% to $399.3 billion.
What drove the swing
On the export side, crude oil shipments fell by $4.5 billion and nonmonetary gold exports declined by $3.9 billion. Those two categories alone account for a combined $8.4 billion drop.
Imports told a different story. Computers surged by $6.9 billion, computer accessories jumped $6.6 billion, and semiconductors saw a significant increase as well.
The goods deficit specifically hit $119.6 billion, partially offset by a services surplus of $31.0 billion. That services surplus ticked up by $200 million from the prior month.
An advance goods-only report released on August 27 had already previewed the damage, pegging the merchandise deficit at $118.8 billion.
The bilateral picture
Breaking down the deficit by trading partner reveals some dramatic concentrations. Mexico posted the widest bilateral goods deficit at $26.3 billion, followed by Vietnam at $24.8 billion and Taiwan at $20.7 billion.
Year-to-date context and what to watch
Through July 2026, the cumulative trade deficit has actually decreased by 29.6% compared to the same period in 2025.
The technology import surge is worth monitoring. Companies stockpiling chips and computing hardware ahead of potential tariff changes or supply disruptions can create artificial spikes in import data. If that’s what happened in July, the deficit could narrow just as quickly in subsequent months as the front-loading effect fades.