Goods imported into the United States fell by a staggering 20% in April, marking the sharpest monthly decline on record, following a wave of tariffs imposed by President Donald Trump.
The plunge reflects a dramatic slowdown in trade activity, especially after many businesses rushed earlier in the year to bring in goods ahead of the promised tariff hikes.
Imports from key partners such as China and Canada dropped to their lowest levels since 2020 and 2021, respectively, according to the US Commerce Department.
This sharp decline in imports significantly reduced the US trade deficit in goods, which shrank by nearly half — a record drop.
Oxford Economics commented that the latest trade figures clearly show the impact of the tariff measures, though they urged caution in interpreting the numbers due to the prior surge in activity.
Since his return to office in January, Trump has increased import taxes on various items including foreign steel, aluminium, cars, and broadly imposed a 10% tariff on most goods from global trading partners.
Some nations had initially faced even steeper duties, but Trump suspended these for 90 days to allow room for negotiations.
The administration maintains that the tariffs are meant to revive domestic manufacturing and boost leverage in trade talks.
Amid rising trade tensions, President Trump and Chinese President Xi Jinping held a phone conversation on Thursday, which Trump described as “very good,” as both sides agreed to resume trade discussions.
Analysts note that the effective US tariff rate has now reached its highest point since the 1930s.
As companies evaluate how to adapt to the changing trade landscape, sectors in Canada and Mexico have been hit hard — with Mexico’s steel exports to the US halved last month, and Canada’s trade deficit reaching a record C$7.1 billion.
April’s report showed declines across multiple product categories — imports of cars fell by one-third, while pharmaceuticals, electronics, toys, and clothing also saw significant drops.
However, imports from Vietnam and Taiwan increased briefly, following Trump’s temporary suspension of higher tariffs on those countries.
Despite April’s sharp decline, overall US goods imports for the first four months of 2025 are still 20% higher than the same period in 2024, with exports up by 5%.
The total goods and services trade deficit for April stood at $61.6 billion, down sharply from $138.3 billion in March.
