US goods trade deficit widens in September as AI boom drives imports to record high

The US trade deficit in goods widened more than expected in September. This comes as imports climbed to a record high. According to Reuters, the surge is driven by demand for capital goods associated with the artificial intelligence (AI) infrastructure boom, indicating that trade could have weighed heavily on economic growth in the third quarter.

The latest deterioration in the trade balance is reported by the Commerce Department on Wednesday, as per the news agency. Reportedly, it prompted some economists to estimate that trade may have shaved as much as four percentage points off Gross Domestic Product (GDP) growth in the July-September quarter.

However, the government's advance estimate of third-quarter GDP, scheduled for release on Thursday, is still expected to show strong growth, supported by a surge in AI-related investments and resilient consumer spending.

"Although trade will weigh on quarterly GDP, this is a sign of strength rather than weakness for the US economy as it signifies continued business investment and momentum for consumer spending," said Daniel Vielhaber, an economist at Nationwide, as quoted by Reuters.

US goods trade

The goods trade deficit rose 2.1%, or $2.8 billion, to $134.9 billion in September. It marked the highest level since March 2025, the Commerce Department's Census Bureau said. Economists surveyed by Reuters had predicted the deficit to come in at $130.2 billion.

The goods trade gap continued to widen through the third quarter.

Imports of goods increased 2.4%, or $8.1 billion, to a record $344.1 billion in September, led by a 7.5% increase in capital goods. Capital goods imports surged 77.2% from a year earlier.

"So much of the hardware that the tech companies need is coming from overseas, driving a massive widening in the trade gap," said Stephen Stanley, chief US economist at Santander US Capital Markets to Reuters.

Imports vs exports

Besides the AI investment boom, sustained consumer spending despite rising living costs has also been cited as contributing to the increase in imports.

Consumer goods imports rose 3.1% in September, while imports of other goods increased 6.7%. Imports of industrial supplies, which include gold and petroleum, declined 6.0%.

For the unversed, gold is excluded from the calculation of GDP.

Imports of food and motor vehicles also fell during the month.

In terms of export, shipments of goods increased $5.3 billion, or 2.6%, to $209.2 billion in September.

Food exports jumped 12.8%, while exports of capital goods rose 5.4% and consumer products advanced 6.5%. Exports of motor vehicles and industrial supplies also saw a decline, Reuters reported.

Trade weighs on GDP growth

Economists estimated that trade could subtract four percentage points from GDP growth in the third quarter, while those at Oxford Economics put the drag at 3.25 percentage points.

Trade has not contributed to US GDP growth for three consecutive quarters, added the report.

However, it is believed that a portion of September's imports ended up as unsold inventory at wholesalers and retailers, which could potentially help cushion the impact on GDP.

The Census Bureau reported that wholesale inventories increased 0.6% in September. Reportedly, retail inventories rose 0.3%. Stocks at motor vehicle and parts dealers increased 0.2%.

Apart from motor vehicles and parts, retail inventories rose 0.4% in September after edging up 0.1% in August.

Previously, a Reuters survey of economists had forecast the US economy to grow at an annualised rate of 3.2% in the third quarter, compared with 2.2% in the second quarter.

About the Author

Sneha Biswas specialises in covering entertainment and pop culture, with a specialisation on Bollywood, Hollywood, OTT platforms, K-pop, K-dramas, and major developments in the US entertainment industry. She believes in telling stories that balance speed with substance, and in making entertainment journalism contextual, culturally aware, and reader-first rather than purely reactive.<br><br> With over six years of experience in digital media, Sneha currently serves as a Deputy Chief Content Producer at Live Mint. She has spent more than three and a half years with the HT Group and returned to the organisation in February 2025, joining Live Mint to uplift the entertainment section. Over the past year, she has been closely involved in entertainment coverage including breaking news, explainers, trend reporting, box office reports and analysis for the audience.<br><br> Sneha is Google News certified, having completed training focused on newsroom best practices, digital reporting, and SEO-driven content strategies. Her work reflects a strong understanding of audience behaviour, search trends, and the evolving consumption patterns of entertainment news across formats.<br><br> Prior to her current role, Sneha has worked across multiple content and editorial functions within digital newsrooms, building expertise in content planning, editing, and real-time coverage. Her professional interests lie at the intersection of entertainment, internet culture, and global pop trends.<br><br> Working for the National city team, Biswas closely follows global entertainment movements while maintaining a strong pulse on what is happening in India.