The US goods and services trade deficit widened to $105.6 billion in August 2026 from $92.8 billion in July, but for the first eight months of the year it was $138.2 billion, or 19.9%, smaller than in 2025, as exports rose 11.8% and imports 4.4% [1]. At the same time, tariff revenue fell: after the Supreme Court struck down the tariffs imposed under the International Emergency Economic Powers Act (IEEPA), refunds pushed net customs receipts below zero in May, June and July 2026, Treasury data show [3][4].
How big is the US trade deficit in 2026?
The trade deficit is the amount by which imports of goods and services exceed exports. In August 2026, exports were $315.2 billion and imports $420.8 billion [1]. The goods deficit rose $12.8 billion to $136.6 billion, while the services surplus held at $31.0 billion [1]. The average monthly deficit for the three months to August was $89.9 billion, up $25.4 billion from the same period of 2025 [1].
| Month (goods only) | 2026 exports | 2026 imports | 2026 balance | 2025 balance |
|---|---|---|---|---|
| January | $186.4 billion | $260.5 billion | -$74.2 billion | -$153.0 billion |
| March | $221.4 billion | $302.3 billion | -$80.9 billion | -$150.8 billion |
| May | $208.2 billion | $311.9 billion | -$103.6 billion | -$91.6 billion |
| July | $197.5 billion | $332.9 billion | -$135.5 billion | -$116.7 billion |
| August | $204.7 billion | $336.2 billion | -$131.4 billion | -$83.1 billion |
| January to August | $1,639.5 billion | $2,415.2 billion | -$775.7 billion | -$887.3 billion |
Source: DataPorium Trade, US goods trade on a Census basis, not seasonally adjusted [2]. These monthly goods figures differ from the seasonally adjusted goods-and-services totals in the official release [1].
The pattern changed during the year. Early 2026 deficits were much smaller than a year earlier, when imports were unusually high in the first quarter of 2025 [2]. Since May, monthly goods deficits have been larger than a year earlier, with imports rising to $336.2 billion in August 2026 [2].
Adjusting for price changes shows that volumes, not just prices, moved. In August, the real (inflation-adjusted) goods deficit rose 8.2% to $114.7 billion, as real imports of goods grew 4.1% and real exports 1.3% [1]. In nominal terms, the goods deficit rose 11.1% [1]. The gap between the two suggests that higher import prices added to the August deficit on top of larger volumes.
By country, the August figures showed the largest monthly deficits with Mexico ($27.7 billion), Vietnam ($24.0 billion), Taiwan ($18.3 billion) and China ($16.4 billion), and the largest surpluses with the Netherlands ($7.7 billion) and the United Kingdom ($3.6 billion) [1]. The deficit with Canada rose $4.1 billion to $7.1 billion in the month [1].
Which countries does the US have the biggest trade deficits with?
| Country | Goods balance, Jan to Aug 2026 | US exports | US imports |
|---|---|---|---|
| Vietnam | -$163.9 billion | $12.2 billion | $176.1 billion |
| Mexico | -$155.9 billion | $263.5 billion | $419.3 billion |
| Taiwan | -$147.7 billion | $39.3 billion | $186.9 billion |
| China | -$109.6 billion | $73.9 billion | $183.5 billion |
| Thailand | -$75.7 billion | $17.0 billion | $92.7 billion |
| South Korea | -$55.1 billion | $55.0 billion | $110.1 billion |
| Germany | -$42.7 billion | $57.9 billion | $100.6 billion |
| Canada | -$35.5 billion | $234.2 billion | $269.6 billion |
Source: DataPorium Trade, goods trade January to August 2026 [2].
Vietnam has passed Mexico and China as the largest bilateral goods deficit in 2026 [2]. Taiwan, a major supplier of chips and servers, accounted for a $147.7 billion deficit; the Fed's minutes noted that the AI buildout "fueled strong imports of high-tech capital goods" [2][6]. Mexico remains the largest US trading partner, with $682.8 billion of two-way goods trade in the first eight months [2].
Exports have been the bright spot. Year-to-date exports of goods and services rose 11.8% [1]. The Fed's minutes said real energy exports reached record highs in the second quarter "amid disruptions to oil shipments from the Middle East" [6].
What happened to tariffs and tariff revenue?
The Supreme Court ruling and refunds
In February 2026, the Supreme Court ruled that IEEPA did not authorize the broad tariffs imposed in 2025, and a federal judge at the Court of International Trade later ordered that the tariffs collected under it be refunded to importers [4][5]. US Customs and Border Protection opened a refund system called CAPE in late April [4]. In a court filing reported by CNBC on August 5, the government said about $100 billion had been completed and sent to the Treasury for payment as of July 31, roughly 60% of the about $166 billion collected under IEEPA [4]. The administration has since used other legal authorities to impose tariffs, and those are facing their own court challenges, CNBC reported [4].
Customs receipts
| Month | Net customs duties, 2026 | Same month, 2025 |
|---|---|---|
| April | $22.1 billion | n/a |
| May | -$0.04 billion | n/a |
| June | -$25.6 billion | n/a |
| July | -$8.5 billion | n/a |
| August | $12.8 billion | $29.5 billion |
| Fiscal year to August | $167.3 billion | $165.2 billion |
Source: U.S. Treasury, Monthly Treasury Statement, customs duties net of refunds [3]. The federal fiscal year runs from October to September.
Net receipts are collections minus refunds. Refunds exceeded new collections from May through July 2026, so net customs revenue was negative in those months [3]. Even so, because tariff collections were high from October 2025 to April 2026, net customs duties for fiscal 2026 through August, $167.3 billion, were slightly above the $165.2 billion of the same period a year earlier [3].
Effect on companies
Refunds have shown up in corporate results. PepsiCo said tariff refunds added about 4 percentage points to its third-quarter core operating profit growth [7]. Only the importer of record can claim a refund, and businesses can keep refunds or pass them on to customers, CBS News reported [5].
The US trade deficit was $105.6 billion in August 2026 but down 19.9% for the year, while tariff refunds after the Supreme Court's IEEPA ruling turned net customs receipts negative from May to July.
Frequently asked questions
What is the US trade deficit in 2026?
The deficit in goods and services was $105.6 billion in August 2026. For the first eight months of 2026 it was 19.9% smaller than in the same period of 2025 [1].
Which country has the largest trade deficit with the US?
Through August 2026, the largest US goods deficit was with Vietnam at $163.9 billion, followed by Mexico at $155.9 billion and Taiwan at $147.7 billion [2].
Are tariffs being refunded?
Yes. Tariffs collected under IEEPA are being refunded to importers after the Supreme Court ruled them unlawful; about $100 billion had been completed for payment by July 31, 2026 [4].
When is the next trade report?
The Census Bureau and BEA are scheduled to release September 2026 trade data on November 4, 2026 [1].
Sources & References
- [1] U.S. Census Bureau and BEA, U.S. International Trade in Goods and Services, August 2026 (October 6, 2026)
- [2] DataPorium Trade (US goods trade by country and month)
- [3] U.S. Treasury, Monthly Treasury Statement, receipts by source (customs duties), via Fiscal Data
- [4] CNBC, Trump admin refunds $100 billion in liberation day tariffs (August 5, 2026)
- [5] CBS News, Businesses starting to receive their IEEPA tariff refunds
- [6] Federal Reserve, Minutes of the FOMC, September 15-16, 2026
- [7] PepsiCo, Third-quarter 2026 results (October 8, 2026)
