Despite U.S. exports coming in at near-record levels in May, the trade deficit widened to its highest level since October of 2008, according to a report released by the Commerce Department on Tuesday.
The Commerce Department said that the value of U.S. exports came in at $174.9 billion in May, the second highest level on record but still short of the April record of $175.8 billion.
Meanwhile, the value of U.S. imports increased to near-record levels, rising to $225.1 billion in May from $219.4 billion in April.
With the value of exports falling and the value of imports rising, the U.S. trade deficit widened to $50.2 billion in May from a revised $43.6 billion in April. As a result, the trade deficit was at its highest level since hitting a record of $59.5 billion in October 2008.
The wider deficit came as a surprise to economists, who had expected the deficit to narrow to $42.7 billion from the $43.7 billion originally reported for the previous month.
Exports of U.S. goods declined by $1.4 billion in May, while imports of goods increased by $5.3 billion, driving the goods trade deficit up by $6.7 billion to $64.9 billion
On the other hand, exports of U.S. services increased by $0.4 billion while imports of services increased by $0.3 billion, giving the U.S. a services surplus of $14.7 billion, up $0.1 billion.
The drop in the value of exports of U.S. goods reflected decreases in exports of industrial supplies and materials, consumer goods and foods, feed, and beverages.
However, exports of capital goods exports increased as did exports of automotive vehicles, parts and engines. The $41.4 billion in exports of capital goods was the highest on record.
The increase in the value of imported goods came amid increases in imports of industrial supplies and materials as well as imports of capital goods, automotive vehicles, parts and engines, and foods, feed, and beverages. Meanwhile, imports of consumer goods declined.
The increase in services exports was mostly accounted for by the sector the Commerce Department calls "other private services." That category includes business, professional, technical, insurance and financial services.
The passenger fares, travel and other transportation services sectors also increased U.S. service exports.
The increase in service imports also included increases in other private services, passenger fares and other transportation services.
The May trade figures showed that the U.S. trade surpluses with Hong Kong, Singapore and Egypt narrowed, while the surplus with Australia widened somewhat.
The trade deficit with China widened to $25 billion from $21.6 billion, and the deficit with the members of OPEC, the Organization of Petroleum Exporting Countries, widened from $9.6 billion in April to $11.3 billion.
May imports from OPEC were the highest on record since October 2008, according to the Commerce Department, driven by the high average price of a barrel of crude oil of $108.70.
That import price of oil is the highest since August 2008.
The U.S. trade deficit with Mexico of $6.3 billion was up from the $5.5 billion recorded in April, marking the highest deficit since May 2008.
The U.S. did see its trade deficit with Japan narrow to $2.6 billion from the $3.6 billion in April, likely a result of supply-chain disruptions caused by the massive earthquake, tsunami and nuclear crisis that struck Japan.
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May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.