The United States trade deficit narrowed significantly in August as imports fell sharply under Donald Trump’s sweeping tariff regime, Reuters reported on Wednesday.

According to the report, the trade gap declined to $59.6 billion, marking a 23.8% drop from the previous month. The improvement was driven largely by a 5.1% fall in imports, which slid to $340.4 billion, while exports rose slightly by 0.1% to $280.8 billion.

Reuters noted that Trump’s protectionist trade policies, defined by broad, across?the?board tariffs, have triggered “big swings” in imports and the overall trade balance, distorting key economic indicators and complicating efforts to assess underlying momentum in the world’s largest economy.

The report, which was originally scheduled for release on October 7, was delayed due to a 43?day U.S. government shutdown.

Recall that President Trump reintroduced new policies upon returning to office in January 2025, rolling out a universal 10% tariff on most imports and imposing significantly higher duties on goods from China, Europe, Mexico and Canada.

The administration maintains that the policy is aimed at reducing U.S. reliance on foreign products and reviving domestic manufacturing.

However, major global economic institutions including the World Trade Organization (WTO), International Monetary Fund (IMF) and Organisation for Economic Co?operation and Development (OECD), have repeatedly warned that the tariff regime is straining global trade and increasing supply?chain uncertainty.

Forecasts for global growth have been cut several times, with analysts citing rising import costs, disruptions to sourcing networks, and the prospect of retaliatory measures from America’s trading partners. (LEADERSHIP)