Exports and imports grew in tandem, and the expansion of the U.S. trade deficit in February was lower than expected.

The widening of the U.S. trade deficit in February was lower than expected, as both imports and exports increased. Data released by the U.S. Commerce Department on Thursday showed that the goods and services trade deficit widened by 4.9% to $57.3 billion from the previous month, which was lower than the economists' forecast of $61 billion. In February, exports increased by 4.2%, primarily driven by gold and natural gas exports. Imports increased by 4.3%, mainly due to increased imports of computers, semiconductors, and cars, with goods imports reaching near the highest level in nearly a year. Imports of intellectual property usage fees also rose, which may reflect a temporary boost related to broadcasting rights for the Winter Olympics. By region, the U.S. trade deficit with China widened to $13.1 billion. The trade deficit with Mexico also expanded, while the deficit with Canada narrowed to its lowest level since the pandemic. Since U.S. President Trump announced his aggressive tariff policy a year ago, the monthly fluctuations in the U.S. trade balance continue to reflect the instability in the implementation of this policy. Following the Supreme Court's ruling to cancel several tariff measures, the current tariff rates have fallen to the lowest level since April 2025. However, a key question this year is whether businesses will expand their imports or shift towards domestic production. After the ruling was announced, the White House quickly replaced some import tariff measures. Although spending on building artificial intelligence infrastructure has increased demand for foreign-manufactured computer chips and other equipment, import data still shows monthly fluctuations. The February trade data will help economists further refine their forecasts for first-quarter GDP. Prior to the release of this data, the Atlanta Fed's GDPNow forecast indicated that net exports would drag first-quarter GDP down by about 0.25 percentage points, similar to the situation in the fourth quarter.