Data shows that imports declined and exports rose in the month before the Supreme Court struck down most of the president's tariffs.

The U.S. Department of Commerce reported on Thursday that the goods and services trade deficit fell to $54.5 billion in January, narrowing by 25% compared to the previous month. This movement reflects the continued significant trade fluctuations resulting from the tariff policies of the Trump administration. Exports increased by 5.5% to $302.1 billion during the month, primarily driven by shipments of gold, computers, and other precious metals. Imports fell by 0.7% to $356.6 billion in January. The combination of rising exports and falling imports contributed to the contraction of the trade gap. President Trump has long viewed the U.S. trade deficit as a sign of economic weakness and has sought to reduce it through tariff increases. Economists have questioned this strategy, with most arguing that trade deficits are largely determined by other economic factors such as government spending and the value of the U.S. dollar. Last year, the U.S. goods trade deficit remained elevated and hit a record high, partly due to sustained imports of expensive semiconductors and weight-loss drugs, as well as importers stockpiling foreign goods ahead of expected tariff implementations. The rise in exports and narrowing of the trade deficit in January were partly attributable to gold and precious metals trade. Over the past year, gold prices have surged significantly as investors sought safe-haven assets, contributing to sharp swings in U.S. import and export values. In January, exports of gold and other precious metals collectively increased by $8.8 billion, far exceeding the $4.2 billion rise in exports of computers and aircraft. Overall U.S. goods exports increased by $14.6 billion during the month. The decline in imports was mainly due to a $3.4 billion drop in pharmaceutical imports and weaker trade in automobiles, parts, and engines. These figures depict a trade landscape shaped by a tariff system that has now been largely invalidated. On February 20, the Supreme Court ruled that President Trump exceeded his authority last year when he used an emergency statute to impose high tariffs on nearly all trading partners. The Trump administration was forced to remove the double-digit tariffs levied under that statute, creating substantial uncertainty for future trade policy. The president had used the emergency law to impose tariffs on nearly one-third of U.S. imports, covering goods worth more than $300 billion. Currently, the administration is attempting to rely on other trade laws to reinstate previous tariffs. Following the Supreme Court decision, Trump immediately announced a 10% global tariff, though this measure can only remain in effect for 150 days without congressional approval. On Wednesday, the Trump administration unveiled a new tariff plan set to take effect after the expiration of the 10% levy. The administration announced the initiation of new investigations into 16 major trading partners, accusing their manufacturing sectors of "overcapacity." It claimed that excess production has led to persistent large trade deficits with these countries. The U.S. Trade Representative's office stated it would review a range of policies that incentivize manufacturing capacity beyond domestic consumption in those nations. The U.S. Trade Representative also indicated that another trade investigation targeting labor-related laws in 60 countries could be announced as early as Thursday, with additional probes into areas such as digital services likely to follow.