On February 19, 2026, the Commerce Department reported that the US deficit in the trade of goods, the main focus of Trump's protectionist policies, widened 2% to a record $1.24 trillion in 2025. The overall goods and services deficit was $901.5 billion, down from $904 billion in 2024, a reduction of just 0.2%, or $2.1 billion. It was still the third-highest on record.
Trump spent 2025 slapping double-digit tariffs on imports from most countries, including an across-the-board 10% duty announced in April and so-called reciprocal tariffs aimed at specific countries that ran surpluses with the US. He argued the tariffs would protect US industries and bring manufacturing back to America. Instead, the deficit in goods hit a record as American companies boosted imports of computer chips and other tech goods from Taiwan to support massive investments in artificial intelligence.
The tariffs shifted trade more than they shrank it. The goods deficit with China fell nearly 32% to $202 billion, but trade was diverted away from China. The goods gap with Vietnam rose 44% to $178 billion, and the gap with Taiwan doubled to $147 billion. The Mexico gap grew to nearly $197 billion from $172 billion, while the Canada gap shrank 26% to $46 billion.
The trade gap surged from January through March as companies imported goods ahead of the tariffs, then narrowed for most of the rest of the year; October registered the lowest monthly deficit since 2009. A larger services surplus, $339 billion, up from $312 billion, kept the overall figure from widening.
Correction (October 14, 2026): An earlier version called Trump's tariffs the most aggressive in modern history, said he repeatedly promised they would eliminate the trade deficit, said the supply-chain shift was exactly what economists predicted, and tied October's low deficit to the government shutdown and a contracting economy. None of those claims could be traced to the sources and they have been removed or softened. The earlier version also called October the one month the deficit genuinely narrowed; AP reports it narrowed for most of the year after the first quarter. It said tariff costs were largely passed to consumers; AP says they are often passed along. A dead AP link was replaced with AP's own page.