Gary Hershorn/Getty Images Cargo ships are unloaded at the Maher Container Terminal and APM Terminal on New jersey's Newark Bay on June 1, 2025. Key Takeaways The U.S. trade deficit fell from an all-time high in March to $61.6 billion in April, the biggest plunge on record. The drop shows that the rush to import items ahead of President Donald Trump’s tariffs has largely ended.

While the import surge helped drag down GDP in the first quarter, economists expect a big rebound in the second quarter as exports and trade services grow. A dizzying drop in April imports along with growing levels of U.S. exports could lead to a big recovery in the U.S. economy. The U.S. trade deficit plunged in April as U.S. imports exceeded exports by $61.6 billion.

That’s down from the $138.3 billion revised trade deficit in March, the highest ever recorded as importers rushed to bring in goods ahead of President Donald Trump’s tariffs. The data showed that imported goods dropped by 16.3% in April, while rising exports and a rebound in the trade services surplus also helped narrow the gap. A drop in the trade deficit was anticipated, but it was slightly larger than economists surveyed by The Wall Street Journal and Dow Jones Newswire expected.

“The economy has essentially hit pause on discretionary imports and is now working off inventories as businesses and consumers delay spending and wait for clarity on tariffs,” wrote Nationwide Financial Markets Economist Oren Klachkin. Growing Export Levels Expected to Fuel Second Quarter GDP Rebound The result will likely help push a big recovery in the U.S. gross domestic product (GDP), which shrank by 0.2% in the first quarter. The decline in economic growth was largely due to the surge in imports as shippers rushed to get products into the U.S. before tariffs took effect.

But with exports growing by $6.2 billion in April, economists expect GDP to expand in the year’s second quarter. “The substantial widening [of the trade deficit] in recent months defined the first quarter, where net exports subtracted nearly five percentage points off headline GDP growth,” wrote Wells Fargo economists Shannon Grein and Tim Quinlan. “This early Q2 read tells us to expect a big reversal.” Read the original article on Investopedia