US Trade Deficit Surges 33% in December, Driven by Tariff Policies

In December, the United States experienced a notable increase in its trade deficit, soaring nearly 33% to reach $70.3 billion. This marks the second consecutive month of rising trade gaps, underscoring a volatile trend observed throughout 2025. The fluctuations in trade deficits were largely influenced by the impact of President Trump's fluctuating tariff policies. While his administration aimed to reshape global trade relations, these efforts have not yet resulted in a significant reduction of the trade deficit. According to the Bureau of Economic Analysis, the annual trade tally for 2025, incorporating both goods and services, totaled $901.5 billion, a slight decrease from the previous year's figure of $903.5 billion. The announcement of the new figure coincided with remarks from Trump, who stated that trade deficits were on the decline and boldly predicted that in 2026, the trade deficit would "go into positive territory during this year, for the first time in many decades," as mentioned in his post on Truth Social. President Trump during an event at Fort Bragg, N.C., on Feb. 13. (Mandel Ngan/AFP via Getty Images) · MANDEL NGAN via Getty Images The effects of tariffs on the trade deficit remain unclear, particularly following the notable increase early in 2025, which saw US firms import extensively to preempt new tariffs. While the trade deficit fluctuated throughout 2025, a significant spike was recorded in recent months. Recent monthly variations have been attributed to significant trades in gold and technology equipment. Notably, telecommunications imports saw an increase of $1.3 billion. In an analysis, Capital Economics stated, "The usual suspects were behind the widening in the trade deficit at the end of last year: gold, pharmaceuticals and IT equipment," also noting that this data keeps their fourth-quarter GDP growth estimate steady at an annualized 3.4%. Find out more: 5 ways to tariff-proof your finances The newly released December statistics, which were deferred due to a recent government shutdown, indicate that the trade deficit has risen for two months following a low point in October, when it dipped to just under $30 billion — a level not seen since 2009. The December data revealed that US imports fell by approximately $5 billion, while exports increased by $12.3 billion. Despite the imposition of tariffs, total imports in 2025 surged to around $3.4 trillion. Trade with Canada reached its lowest point since 2022 amid ongoing tensions,