Our politically-sensitive trade deficit with China slightly narrowed in August according to a new report from the Commerce Department, but our overall trade deficit increased.
Our trade deficit with China decreased by about $700 million but overall imports surged to an all-time record high of $57.2 billion.
The overall U.S. deficit in goods and services trade widened to $54.9 billion in August, more than expected.
The bigger overall gap reflects a rise in imports, particularly consumer goods including mobile phones, which could result from President Donald Trump's Aug. 1 announcement of a 10% tariff on a further $300 billion in Chinese imports. Overall imports of consumer goods were a record $57.2 billion in August. [...]
Overall exports increased 0.2% to $207.9 billion, including industrial supplies and foods. Imports rose 0.5% to $262.8 billion.
Our overall trade deficit is still increasing because American consumers are still buying shit and that shit has to come from somewhere. Trump can play whack-a-mole with our trading partners until the end of his reign and there will always be another source for goods that American consumers have demand for.
In this case -- and actually in several recent cases -- a surge in imports was driven by Trump himself as he threatened to impose or did impose tariffs on foreign goods. In each case, American business have imported and stockpiled as much as they can to meet consumer demand before Trump's tariffs take effect.
Trump will impose significant tariffs on European goods two weeks from today and another tranche of tariffs on about $150 billion in Chinese goods in December so we can expect to see similar stockpiling in future reports from the Commerce Department.
It's possible that this record high number of imports was already broken in September, but we won't know until later this month or early next month.
Our trade deficit for the entire year is expected to weigh in at a new record high, but that may not be entirely clear until comprehensive data is available in February.