A recent press release from the Coalition for a Prosperous America states that the U.S. trade deficit in goods and services dropped 3.4 percent from January to February. Data shows that the U.S. exported $2.3 billion more in February than in January.
The U.S. goods deficit with China came back significantly lower in February at $24.8 billion. This is a 28.1 percent improvement from January’s $34.5 billion. This is our lowest deficit with China since March 2017.
These figures are evidence that the trade tariffs imposed on Chinese goods are reducing imports from China. In February, the U.S. exported $8.4 billion worth of goods to China. This is a $1.4 billion decrease from February of 2018. However, imports from China also fell by $5.9 billion. China has issued retaliatory tariffs on our exports, but they have not had as significant of an effect as have U.S. tariffs on Chinese goods.
On the other hand, the Mexican trade deficit has grown to $7.4 billion, a whopping $1.6 billion more than the month prior. This is likely due to the automotive industry in Mexico. Our trade deficit with France was our worst since October 2017, at $2 billion and that with Japan also worsened. Fortunately, our deficit with Germany improved by $0.8 billion to $4.5 billion for February.
Our deficit with the European Union as a whole improved greatly, dropping to $9.2 billion. This is 21.4 percent better than January’s deficit. It is reported that the Trump administration is considering negotiations for a trade deal with the EU.