The U.S. trade deficit narrowed sharply in August 2025 to $59.6 billion, improving -23.8% MoM from July’s revised $78.2 billion, reflecting a large drop in imports that outweighed stable exports.

• Exports rose +0.1% MoM to $280.8 billion, a modest $0.2 billion increase driven by higher services exports, signaling broadly steady outbound trade activity.

• Imports fell -5.1% MoM to $340.4 billion, an $18.4 billion decline led by sharp drops in industrial supplies, nonmonetary gold, consumer goods, and capital goods.

• The goods deficit shrank by -$18.1 billion to $85.6 billion, the smallest since September 2023, while the services surplus increased +$0.5 billion to a record $26.1 billion, both contributing to the overall deficit improvement.

• Year-to-date, the trade deficit widened +25.0% YoY (+$142.5 billion), as imports (+9.2% YoY) continued to outpace exports (+5.1% YoY), showing that August’s improvement was counter to the broader annual trend.

• The three-month average deficit decreased to $65.6 billion, as average exports were little changed while average imports fell $3.7 billion, indicating recent softening in import demand.

• Goods exports slipped -$0.5 billion MoM, with declines in consumer goods (-$1.5 billion), pharmaceuticals (-$1.2 billion), and industrial supplies (-$0.6 billion) partly offset by gains in capital goods (+$2.4 billion) and computers (+$2.3 billion).

• Goods imports plunged -$18.6 billion MoM, led by industrial supplies (-$11.3 billion), nonmonetary gold (-$9.3 billion), and consumer goods (-$3.7 billion), marking one of the broadest monthly declines across categories.

• In real terms, the inflation-adjusted goods deficit narrowed -16.9% MoM to $83.7 billion, as real imports fell -7.2% while real exports dipped only -0.4%, highlighting a substantial improvement in real net trade.