U.S. Trade Deficit Reaches $84.4 Billion in September

The U.S. trade deficit sharply increased in September, reaching $84.4 billion. This figure indicates a 19.2% rise compared to the revised $70.8 billion deficit in August. The widening of the deficit is attributed to businesses increasing imports in response to strong domestic demand and potential tariff increases. This increase, announced by the Bureau of Economic Analysis of the Department of Commerce on Tuesday, surpassed economists' forecast of an $84.1 billion deficit.

Imports surged as companies prepared for the possibility of new tariffs, especially in light of the ongoing presidential election. Republican candidate Donald Trump has promised to impose significant tariffs on imported goods if elected, proposing a 60% tariff on Chinese goods and at least a 10% tariff on all other imports. Trump is currently in a tight race with Democratic candidate Kamala Harris.

The increase in the trade deficit has had a noticeable impact on the U.S. economy, subtracting 0.56 percentage points from gross domestic product (GDP) in the third quarter. Despite the overall economy growing at an annual rate of 2.8% from July to September, the trade deficit has exerted downward pressure on growth for three consecutive quarters.