US Import Shock and Trade Deficit Reduction in the First Month of New Tariffs

The aggressive tariff policy of US President Donald Trump is leaving visible marks on international trade, according to a press release from the German statistical office (Destatis). In April 2025, US imports of goods dropped nearly 20% compared to the previous month—a reduction of $68.4 billion, according to preliminary data from the US Census Bureau. Imports fell to $276.1 billion after reaching a record high of $344 billion in March. This sharp decline stems from a phase of heightened economic uncertainty. In March, many companies continued stockpiling ahead of new import tariffs—especially before the so-called ‘Freedom Day,’ when the US government announced punitive tariffs on Chinese products. Although reciprocal tariffs were initially suspended for 90 days, a basic 10% tariff on all imports remained in effect, supplemented by particularly high tariffs on Chinese goods. This led to historically high average tariff coefficients in the US. As a result, the US goods trade deficit significantly decreased in April—from $163 billion in March to $87.6 billion. This represents the lowest level since December 2023. However, the deficit reduction is more a short-term market reaction than a structural correction. From a long-term perspective, April appears to be a return to normalcy following March’s import surge, which had already inflated first-quarter GDP growth. Increased volatility in foreign trade is expected in the coming months, depending on whether new trade agreements can be reached before the end of the 90-day tariff pause (April 9, 2025). If not, imports may rise again as early as June, showcasing how political decisions impact global trade in the short term, notes Destatis.