US Trade Deficit Widens 24.4 Percent to 88.6 Billion Dollars in July
The United States goods and services trade deficit widened by 17.4 billion dollars, or 24.4 percent, to 88.6 billion dollars in July 2026 from a revised 71.2 billion dollars in June, as exports fell 2.1 percent and imports rose 2.8 percent in the same month, the Census Bureau and the Bureau of Economic Analysis said.
Exports Down, Imports Up, at the Same Time
Exports fell to 310.7 billion dollars, a decline of 6.6 billion dollars, led by an 8.7 billion dollar drop in industrial supplies and materials, including a 4.5 billion dollar fall in crude oil exports and a 3.9 billion dollar fall in nonmonetary gold. Imports rose to 399.3 billion dollars, an increase of 10.8 billion dollars, as capital goods alone rose 14.4 billion dollars, a figure that on our calculation exceeds the entire increase in total imports, meaning other import categories, including a 1.8 billion dollar drop in industrial supplies, netted down against the capital goods surge. Computer, computer accessory and semiconductor imports together rose 14.7 billion dollars, on our calculation slightly more than the capital goods total itself, pointing to declines elsewhere within that same category. On our calculation, July’s single month deficit of 88.6 billion dollars ran 12.9 percent above the three month moving average of 78.5 billion dollars. That average itself widened 11.9 billion dollars from the three months ending in June, indicating the month’s widening was sharper than an already widening recent trend.
A Reversal Against the Year’s Own Trend
The July widening stands against a broader trend in the opposite direction. For the first 7 months of 2026, the cumulative goods and services deficit was down 188.4 billion dollars, or 29.6 percent, from the same period of 2025, as exports rose 12.0 percent and imports rose just 1.9 percent over that longer window. July’s single month reversal, on our reading, interrupts rather than reverses that broader improvement, since 1 month cannot undo a trend built over 7.
| Country | June Balance | July Balance | Change |
|---|---|---|---|
| Mexico (deficit) | -$20.3B | -$27.5B | -$7.2B |
| Switzerland | +$2.9B | -$0.6B | -$3.5B |
| Canada (deficit) | -$6.9B | -$3.2B | +$3.7B |
June balances are derived from BEA’s published July balances and monthly changes. Switzerland moved from a 2.9 billion dollar surplus in June to a 0.6 billion dollar deficit in July.
Prices Explain Part of the Nominal Widening
Real, inflation adjusted goods trade told a more moderate story than the nominal figures: the real goods deficit rose 12.7 percent to 106.4 billion dollars, well below the 17.7 percent nominal increase in the goods deficit the same month, indicating price effects accounted for a meaningful share of July’s nominal widening.
Why it matters: For the United States, July’s sharp monthly deficit widening, driven by a simultaneous drop in exports and jump in capital goods imports, comes even as the broader year to date trend still points toward a narrower trade gap than a year earlier, underscoring how a single month’s data can diverge from the direction of travel over a longer window.
Outlook: The next report, covering August 2026 trade data, is due October 6, 2026.
Sources: US Census Bureau, Bureau of Economic Analysis.
