The flames of war in Iran are compounded by the heavy pressure of tariffs! The US trade deficit fell 4.2% month-on-month, and GDP may be “dragged down” in the second quarter

The Zhitong Finance App learned that since the decline in imports exceeded the decline in exports, the US commodity trade deficit narrowed in June. The US merchandise trade deficit fell 4.2% month-on-month to $101.5 billion, according to data released on Tuesday. In a survey of economists, the median estimate was a deficit of 100 billion US dollars. These figures are not adjusted for inflation.

US merchandise exports fell 1.8%, mainly driven by a decline in exports of industrial goods, while imports fell 2.6%.

The trade deficit has fluctuated in recent months as the Iran war helped boost global demand for US petroleum products, and US companies increased their imports to support the construction of artificial intelligence.

As supply chain delays become more common and the threat of new tariffs looms, companies are also building stocks of goods and materials, raising concerns about further price increases.

The renewed outbreak of hostilities between the US and Iran this month has raised new concerns about the suspension of shipping. US President Trump also announced new tariffs earlier this month to replace those abolished by the US Supreme Court in February.

Exports of industrial supplies, including crude oil and petroleum products, fell 4.4% in June, data on Tuesday showed. This category also includes non-monetary gold, which contributed to data fluctuations over the past year. Volatile consumer goods and automobile exports have rebounded.

Meanwhile, imports of capital goods — a category that includes computers and accessories, semiconductors, and telecommunication equipment — fell for the first time since September, but are still 37.4% higher than a year ago. Imports of consumer goods have also declined.

According to retail inventory data published along with commodity trade data, retail inventory did not change much in June. Wholesale inventories increased 0.3%.

Trade and inventory data will help inform the government's first estimate of GDP for the second quarter, which is due to be released on Thursday. Ahead of Tuesday's data release, the Atlanta Federal Reserve's GDPNow model predicted that net exports would reduce GDP growth by 1.35 percent.

Another data released by the Bureau of Labor Statistics earlier this month showed that US import prices rose 0.3% in June, while export prices fell 0.6%.

More complete trade data for June, including service account income and expenditure, will be released on August 4.