The US trade deficit reached a five-month high in May amid the increased imports of goods, which was likely because of overstocking before any increase in customs duties on Chinese goods.

The trade ministry said the trade deficit grew by 8.4% to 55.5 billion USD in May 2019. The April data were revised to 51.2 billion USD from previously announced 50.8 billion USD. Economists expected the trade deficit to rise to 54 billion USD in May.

The trade deficit with China, which occupies a top spot on President Donald Trump’s campaign “America First”, rose by 12.2% to 30.2 billion USD and imports rose by 12.8%. Donald Trump has recently imposed additional import duties on Chinese goods, forcing Beijing to take retaliatory measures.

Donald Trump and Chinese President Xi Jinping agreed last week for a trade truce and a restart the talks. White House Trade Adviser Peter Navarro said yesterday that talks are going in the right direction, but achieving the deal will take time.

In May, imports grew by 4% to 217 billion USD. The imports of consumer goods grew by 1.4 billion USD, and that of motor vehicles and car parts increased by 2.3 billion USD. Big growth was also recorded in the import of capital goods and supplies of industrial products and raw materials.

Exports of goods grew by 2.8% to 140.8 billion USD. The exports of consumer goods increased by 0.8 billion USD and soybeans registered an increase of 700 million USD. The exports of passenger planes have risen by 500 million USD. Growths are likely to be curtailed after Boeing freezes the supply of its best-selling 737 MAX passenger plane in March. It was grounded indefinitely after two crash casualties in five months.

Adapted to inflation, the trade deficit grew by 4.8 billion USD to 87 billion USD in May. The rise in the so-called real trade deficit shows that trade may be a hindrance to the growth of the gross domestic product in the second quarter.

Trade accounted for 0.94 percentage points of annual growth of 3.1% in the economy in the first quarter. The Federal Reserve in Atlanta predicts that the GDP will rise by 1.5% between April and June.