US Trade Deficit Narrows to $73.3 Billion in June as Imports Fall

The Headline Numbers

The Census Bureau and Bureau of Economic Analysis said in their jointly issued August 4 release that the US goods-and-services trade deficit came in at $73.3 billion for June 2026, a $4.4 billion improvement from a revised $77.6 billion in May. Exports totaled $314.7 billion, down $2.9 billion on the month, while imports totaled $388.0 billion, down a larger $7.3 billion. The goods deficit alone narrowed by $3.9 billion to $102.1 billion, and the services surplus widened by $0.5 billion to $28.8 billion.

What Drove the Import Decline

On the export side, industrial supplies and materials fell $3.3 billion, led by a $5.7 billion drop in crude oil exports that was only partly offset by a $3.4 billion rise in nonmonetary gold exports; capital goods exports also slipped, with computer exports down $1.1 billion. Services exports rose $1.1 billion, helped by gains in financial services and travel.

On the import side, capital goods imports fell $2.1 billion, including a $3.0 billion drop in computer imports partly offset by a $1.1 billion rise in telecommunications equipment; consumer goods imports fell $2.1 billion, with pharmaceutical preparations down $1.9 billion. Services imports rose $0.6 billion, led by higher payments for intellectual property use and transport.

A Sharply Narrower Deficit So Far in 2026 — With a Catch

Year-to-date, the goods-and-services deficit has fallen $189.3 billion, or 33.8%, from the same six months of 2025. The agencies attributed most of that swing to export growth: exports are up $198.3 billion, or 11.7%, so far this year, while imports have risen just $9.0 billion, or 0.4%. On a three-month moving-average basis, however, the deficit actually widened by $5.6 billion to $68.5 billion for the three months through June, as average imports climbed faster than average exports over that window — a reminder that the year-to-date trend and the most recent quarter aren't telling quite the same short-term story.

The Country Breakdown

The June report's country-level detail shows deficits, in order of size, with Vietnam ($21.6 billion), Mexico ($20.3 billion), China ($15.3 billion), Taiwan ($14.9 billion), the European Union ($10.9 billion), South Korea ($7.4 billion), Canada ($7.2 billion), Germany ($7.1 billion), India ($4.5 billion), Malaysia ($4.4 billion), Japan ($3.3 billion), Ireland ($2.7 billion), Italy ($2.5 billion), France ($1.5 billion), and Israel ($1.2 billion). The US posted surpluses with the Netherlands ($7.2 billion), South and Central America broadly ($5.6 billion), Hong Kong ($3.2 billion), Switzerland ($2.9 billion), the United Kingdom ($2.2 billion), Singapore ($1.8 billion), Saudi Arabia ($1.8 billion), Brazil ($1.7 billion), Australia ($1.3 billion), and Belgium ($0.9 billion). The agencies flagged a $4.5 billion swing in the Taiwan balance and a $3.0 billion swing in the South Korea balance from May to June as among the more notable country-level movements.

What's Next

The Census Bureau and BEA are scheduled to publish the July 2026 trade report on September 3, 2026. That release will be the first full monthly trade snapshot to reflect a complete month under the Section 301 forced-labor tariffs that took effect on 60 economies and the European Union in late July, alongside the expiration of the Section 122 global import surcharge on July 24 — an alignment of new and expired trade measures that economists will be watching closely for effects on both sides of the ledger.

Reader Q&A

Why did the US trade deficit shrink in June?

Imports fell more than exports did. Imports dropped $7.3 billion, driven partly by lower capital-goods and pharmaceutical purchases, while exports fell a smaller $2.9 billion, narrowing the overall gap to $73.3 billion.

Is the US trade deficit actually improving this year?

On a year-to-date basis, yes — it's down 33.8% versus the same period in 2025, mostly because exports have grown much faster than imports. But the more recent three-month moving average tells a different story: the deficit widened by $5.6 billion through June, as import growth outpaced export growth over that shorter window.

Which countries does the US run its biggest trade deficits with?

Vietnam ($21.6 billion), Mexico ($20.3 billion), and China ($15.3 billion) topped the list of June deficits, followed by Taiwan, the European Union, South Korea, Canada, and Germany.

How big is the US deficit with India, and is it changing?

The US ran a $4.5 billion goods deficit with India in June 2026. This report doesn't break out a month-over-month change for India specifically, but the figure sits within a broader shift in US-India trade terms following the 10% Section 301 tariff Washington imposed on Indian goods in July 2026 — one of the lower rates in that tariff tier.

When's the next trade report?

The Census Bureau and BEA are due to release the July 2026 trade figures on September 3, 2026 — the first monthly report to fully reflect a month with the new Section 301 tariffs in effect and the Section 122 global surcharge expired.