Goods brought into the US plunged by 20% in April, recording their largest ever monthly drop in the face of a wave of tariffs unleashed by US President Donald Trump.

The retreat reflects the abrupt hit to trade, after firms had rushed products into the country earlier this year to try to get ahead of new taxes on imports Trump had promised.

US purchases from major trade partners such as Canada and China fell to their lowest levels since 2021 and 2020 respectively, the Commerce Department said.

The collapse helped to cut the US trade deficit - the gap between exports and imports - in goods by almost half, a record decline, according to the report.

"The April trade report indicates the impact from tariffs has well and truly arrived," said Oxford Economics, while noting that the latest figures should be interpreted with caution, given the surge in activity earlier this year.

Since re-entering office in January, Trump has raised import taxes on specific items such as foreign steel, aluminium and cars and imposed a blanket 10% levy on most goods from trading partners around the world.

He had briefly targeted some countries' exports with even higher duties, only to suspend those measures for 90 days to allow for talks.

Trump has said the moves are intended to rebuild manufacturing at home and strengthen its hand in trade negotiations.

White House officials are now engaged in intense talks aimed at striking deals before that 90-day deadline expires next month.

Chinese President Xi Jinping and Trump spoke by phone on Thursday to try to reach a breakthrough in those negotiations, as the fragile truce between the two sides showed signs of deteriorating.

In a social media post, Trump said it had been a "very good phone call" focused on trade and that teams from the two sides would be meeting again shortly.

State media in China reported that they had agreed to further talks and extended an invitation of a visit to Trump.

Trump's barrage of tariffs have brought the average effective tariff rate in the US to the highest level since the 1930s, according to analysts.

After a surge in activity earlier this year, the abrupt changes have led to a sharp slowdown in trade as firms weigh how to respond.

In Mexico, the steel industry said its exports to the US had been cut in half last month.

In Canada, the trade deficit hit an all-time high last month, widening to C$7.1bn, as exports to the US shrank for a third month in a row.

Thursday's report from the US Commerce Department showed few categories of products were unaffected by the changes.

Imports of passenger cars dropped by a third from March to April. Pharmaceutical products were hit and imports of most consumer goods also fell, including cell phones, artwork, furniture, toys and apparel.

But imports surged from Vietnam and Taiwan, which saw their exports briefly targeted with higher rates before Trump suspended those levies, according to the report.

Despite the big monthly decline, overall US goods imports in the first four months of the year are up about 20% compared with the same period in 2024.

Exports so far this year are up about 5% compared with 2024.

The overall goods and services deficit in April was $61.6bn, down from $138.3bn in March. (BBC)

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