US trade deficit widens to $70.3 billion in December as exports fall; jobless claims drop sharply

The US trade deficit widened sharply in December as exports declined and imports rose, even as fresh data showed the labour market remains broadly stable.

According to the US Census Bureau and the Bureau of Economic Analysis, the goods and services trade deficit increased to $70.3 billion in December, up $17.3 billion from November — a 32.6 per cent rise.

Exports fell 1.7 per cent to $287.3 billion in December, down $5.0 billion from the previous month. Goods exports dropped $5.5 billion to $180.8 billion, weighed down by a sharp fall in industrial supplies and materials, particularly nonmonetary gold, which declined by $7.1 billion.

However, some sectors posted gains. Capital goods exports rose $2.5 billion, supported by a $0.9 billion increase in semiconductor shipments. Consumer goods exports climbed $1.8 billion, led by pharmaceutical preparations.

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Imports, meanwhile, rose 3.6 per cent to $357.6 billion, increasing by $12.3 billion from November. The rise was driven by higher inflows of goods, pushing the goods deficit up to $99.3 billion. The services surplus narrowed to $29.0 billion.

For the full year 2025, the US goods and services deficit stood at $901.5 billion, marginally lower than the $903.5 billion recorded in 2024. Annual exports increased 6.2 per cent to $3.43 trillion, while imports rose 4.8 per cent to $4.33 trillion.

Separate data from the Labor Department showed initial claims for state unemployment benefits fell by 23,000 to a seasonally adjusted 206,000 for the week ended February 14. Economists had forecast 225,000 claims.

The decline in claims suggests the labour market is stabilising after a brief uptick in late January. Minutes from the Federal Reserve’s January meeting indicated that most policymakers believe labour conditions are showing signs of stabilisation, though risks remain if labour demand weakens further.

The latest figures present a mixed economic picture: a resilient labour market alongside a widening trade gap that could weigh on first-quarter growth.