Photo: Axel Bührmann, via Wikimedia Commons. File photo of a container ship — not a photo of the September trade data itself.
The US trade deficit narrowed slightly in September, even as imports climbed to a record high, the Commerce Department said on Wednesday, November 4 — a reminder that President Donald Trump's tariffs have not yet shrunk the gap between what America buys from the world and what it sells.
The trade shortfall in goods and services contracted 0.7 percent to $105.0 billion in September, from $105.7 billion in August, according to the Bureau of Economic Analysis and the Census Bureau. Economists polled by Reuters had forecast a deficit of $108.0 billion, so the result was slightly better than expected — but it remained close to its widest level since March 2025.
Record imports, record exports — at the same time
Imports rose 1.2 percent to $426.6 billion in September, a record high. Goods imports rose 1.3 percent to an all-time high of $346.9 billion, driven by computers and accessories and by capital goods — the machinery and equipment, including components for artificial intelligence data centres, that have powered much of this year's import surge. Capital goods imports rose to about $158.0 billion from about $146.4 billion in the previous month, according to the report's breakdown. Crude oil imports, by contrast, fell by $1.3 billion.
Exports rose even faster in percentage terms, up 1.9 percent to $321.5 billion, also a record. Goods exports increased 2.5 percent to $211.0 billion, helped by computers, soybeans, crude oil and aircraft. The goods deficit narrowed by $0.7 billion to $135.9 billion, while the services surplus edged down by less than $0.1 billion to $30.9 billion.
On an inflation-adjusted basis, however, the picture was less encouraging: the real merchandise trade deficit widened to $119.5 billion in September, the largest since March 2025, a reminder that part of the nominal improvement reflects prices rather than volumes.
Why the gap stays so large
The deficit has remained large despite the sweeping tariffs imposed since April 2025, because strong domestic demand keeps pulling in foreign goods. Last week the government estimated that imports subtracted 2.64 percentage points from gross domestic product growth in the third quarter — the most since the first quarter of 2025, when businesses rushed orders ahead of the tariffs — even as the economy grew at a 3.4 percent annualized rate in the July-September quarter.
For the first nine months of 2026, the trade deficit narrowed by $92.4 billion, or 12.2 percent, from the same period in 2025, with exports up 11.6 percent year on year against a 6.2 percent rise in imports. The bilateral goods deficit with China widened in September to $21.9 billion from $18.4 billion in August, according to the report's country breakdown.
What to watch next
The trade figures complete a busy week of economic data that has kept the prospect of another Federal Reserve rate rise on the table: private payrolls beat forecasts in October, job openings rose in September, and services prices remain elevated. The next big test is Friday's official October employment report, followed by the Fed's December 8-9 meeting.
For the White House, the September numbers cut both ways. Exports at a record high are a genuine bright spot, and a deficit slightly smaller than forecast is better than the alternative. But a record import bill, driven in part by the very technology goods at the centre of the administration's industrial strategy, shows how hard it is to close a trade gap while American consumers and businesses keep buying at this pace.
Sources: Reuters, "US trade deficit narrows slightly in September; imports race to record high," November 4, 2026; US Bureau of Economic Analysis and Census Bureau, September 2026 international trade report, November 4, 2026; Bloomberg via The Edge Singapore, November 4, 2026; Sharecast, November 4, 2026. Forecasts cited are Reuters and Bloomberg surveys of economists, not results.