The US trade deficit dropped sharply in late 2025, reaching its lowest level since 2009, as import volume decreased under President Trump’s sweeping tariffs, according to new government data.
The overall trade gap plunged 39% to $29.4 billion in October, as imports fell by 3.2%, Department of Commerce figures show. The deficit was significantly lower than the $58.4 billion median forecast from surveys of economists by Dow Jones Newswires and The Wall Street Journal.
While US exports rose by $7.8 billion to $302 billion in October, imports dropped by $11 billion to $331.4 billion. The US trade deficit in September was $48.1 billion.
The figures underscore how Presidents Trump’s volatile and sweeping tariff policies have influenced trade flows. When the president unveiled wide-ranging tariffs on imports from dozens of trading partners, US businesses rushed to stock up on inventory, front-loading imports ahead of planned tariff hikes. This has allowed many companies to avoid passing on the full cost of tariffs to consumers, keeping price hikes on goods relatively tame.
However as of mid-November, it is estimated that US importers face an overall average effective tariff rate topping 16%, the highest since the 1930s and based on recent trade data, this is clearly influencing importers purchasing decisions.
One of the key reasons the US trade deficit dropped to such an extent was exports from China to the U.S. dropped by 20% in 2025. Despite this massive drop, China’s trade surplus surged to a record of almost $1.2 trillion in 2025, as exports rose 5.5% in 2025 to almost $3.77 trillion. While exports to the U.S. are on a downward trend, Chinese exports to Africa surged 26%, those to Southeast Asia grew by 13%, to the European Union by 8% and to Latin America by 7%.
For more information, contact David Lychek, Director – Ocean & Air Services.
