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Capital goods imports surged 11.3% as AI-driven equipment spending lifted total imports to $318.2 billion, while initial jobless claims fell to 203,000
The U.S. goods trade deficit widened to $118.8 billion in July, up $17.4 billion from $101.4 billion in June, the Census Bureau reported Thursday. The reading represented the widest monthly goods deficit recorded since March 2025.
Total imports climbed 3.7% to $318.2 billion, with capital goods accounting for much of the gain after that category surged 11.3%. On the other side of the ledger, exports dropped 2.9% to $199.4 billion, pulled down largely by a steep 11.2% contraction in industrial goods shipments. The expanding gap suggests trade will again subtract from gross domestic product growth, potentially marking a fourth straight quarter of such drag, according to Reuters.
Matthew Martin, senior U.S. economist at Oxford Economics, attributed the capital goods surge to business spending on high-tech equipment tied to the AI investment boom. "We expect capital goods imports to support strong growth in imports well into 2027," Martin said.
