WASHINGTON, United States (AFP) — The US trade deficit surged to a new record in January, government data showed Thursday, as imports spiked while tariff worries flared in the month of President Donald Trump’s inauguration.

Trump returned to the White House this year with pledges to ease cost-of-living pressures for voters, but on the campaign trail he also raised the possibility of sweeping levies across US imports.

The overall trade gap of the world’s biggest economy ballooned 34 per cent to US$131.4 billion, on the back of a 10 per cent jump in imports for the month, said the Commerce Department.

This was the widest deficit for a month on record, dating back to 1992, and the expansion was more than analysts anticipated.

The latest figures came after the US economy saw its goods deficit hit a fresh record too for the full year of 2024 — at $1.2 trillion.

In January, imports came in at $401.2 billion, and this was $36.6 billion more than the level in December, Commerce Department data showed.

US exports, meanwhile, rose $3.3 billion between December and January to $269.8 billion.

Among sectors, imports of industrial goods jumped, and imports of consumer goods rose notably by $6.0 billion.

– Tariff jitters –
Analysts say that the deficit was likely bolstered by gold imports.

But “stripping out this impact, all other imports rose 5.5 percent, indicating front-loading of shipments was in full swing,” said Oxford Economics senior economist Matthew Martin.

This refers to a tendency for businesses to try and get ahead of additional costs from potential tariffs, as well as possible supply chain disruptions down the line.

“The impact of new tariff proposals make the outlook uncertain,” Martin said.

Economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics said of the surge in gold imports: “Tariff threats are reportedly prompting a mass repatriation of gold holdings to the US from elsewhere, mostly via Switzerland.”

But other analysts like Carl Weinberg and Mary Chen of High Frequency Economics caution that they are looking for a “snapback in imports” in February and March figures to show if importers are truly seeking to get ahead of Trump’s levies.

“It is hard to prove that,” they said in a note.

US deficits with other economies were a key focus of Trump’s first administration from 2017 to 2021, and at the time he waged a bruising tariffs war with China in particular.

This time the Trump administration has referred to tariffs as a means to raise government revenue, remedy imbalances and exert pressure on other governments over American priorities.

In January, US goods deficits with China and the European Union both widened.

On the campaign trail last year ahead of November’s election, Trump vowed reciprocal tariffs on nations that taxed US-made products, dubbing this the “Trump Reciprocal Trade Act.”

Since returning to office, the Republican has launched plans for “reciprocal tariffs” tailored to each US trading partner, to tackle trade practices deemed unfair by Washington.

He has promised an announcement on these levies on April 2, while also threatening tariffs on other imports ranging from semiconductors to autos.

Trump hiked tariffs on steel and aluminum imports in his first presidential term too — an action he has revived since returning to office.

A sharp 25 percent levy on the metals is set to take effect this month.