AI data center construction has become a significant engine of import demand, as the components required for that expansion are largely sourced from abroad
Bloomberg / Getty Images
The U.S. trade deficit surged to $77.6 billion in May, according to new data released Tuesday, a 42.2% rise and a level not seen since March 2025. The Bureau of Economic Analysis and Census Bureau report said that import volumes reached their strongest level in 14 months while exports retreated.
On the month, spending on foreign goods and services pushed import totals up by 3.3% to $395.3 billion, even as export revenue slipped 3.2% to $317.7 billion. The combined shift pushed the deficit up $23.0 billion from a revised $54.6 billion in April.
Purchases of computer accessories and semiconductors helped push capital goods imports to an all-time high of $127.9 billion, a gain of $1.1 billion on the month. AI data center construction has become a significant engine of import demand, as the components required for that expansion are largely sourced from abroad. A $3.4 billion decline in computer imports tempered some of that strength. Pharmaceuticals and cellphones lifted consumer goods imports by $3.5 billion, and automotive products contributed an additional $2.2 billion to the overall import increase.
On the export side, within industrial supplies, a $6.2 billion drop in nonmonetary gold shipments accounted for the bulk of a $5.5 billion category-wide decline. Capital goods exports dropped $3.5 billion. Services exports rose $0.8 billion to $107.1 billion, with travel and financial services both contributing to the gain.
The goods deficit expanded $23.6 billion to $106.5 billion in May, while the services surplus widened slightly by $0.6 billion to $28.9 billion.
On a bilateral basis, the largest goods deficits in May were with Vietnam at $20.6 billion, Mexico at $20.1 billion, Taiwan at $19.4 billion, China at $14.5 billion, and the European Union at $9.3 billion. The deficit with Mexico grew $5.3 billion from April, as exports to that country fell $1.5 billion and imports rose $3.9 billion.
Measured from January through May, the cumulative goods and services deficit of $203.9 billion ran 40.6% below the comparable 2025 figure, a gap that reflects how heavily front-loading of imports inflated last year's early-month totals ahead of the spring tariff announcements.
The April deficit had narrowed to $54.6 billion as record U.S. petroleum exports, boosted by the conflict in Iran, helped shrink the gap. That dynamic partly reversed in May, with goods exports broadly declining even as crude oil shipments remained a positive contributor. The three-month moving average deficit rose $7.5 billion to $62.9 billion for the period ending in May.
The combination of rising imports and falling exports in May signals that trade will likely weigh on second-quarter economic output, The Wall Street Journal reported. The Commerce Department is scheduled to release its advance second-quarter GDP estimate later this month. The next trade report, covering June, is due Aug. 4.
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