The U.S. trade deficit unexpectedly increased in May as the country experienced its largest export decline since the start of the coronavirus pandemic. It is a setback for President Donald Trump, who sees the trade deficit as a problem and wants to combat it.
The trade deficit in goods rose in May from $87.6 billion to $96.6 billion. Economists had expected a decrease. A trade deficit is the result of more imports than exports. If imports remain the same and exports continue to decline, the trade deficit grows.
U.S. goods exports fell by 5.2 percent in May. In particular, exports of industrial goods such as crude oil declined, which is probably partly explained by the fall in oil prices. These prices reached a record low in early May. Imports remained virtually unchanged.
President Trump is annoyed by the U.S. trade deficit. He is annoyed by countries that buy little in the United States – which does not apply to the Netherlands – and is trying to change the balance with import duties.
The American economy shrank slightly more in the first quarter than previously thought, according to figures from the U.S. Department of Commerce. The new estimate is 0.5 percent contraction. It was expected to be 0.2 percent. The first months of Trump’s second term were therefore more unfavorable than previously reported.