US trade deficit increases slightly, even as Americans buy less from China

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Overall, the monthly US trade deficit in goods and services has reached $ 50 billion, the Census Bureau announced Thursday. US firms imported more foreigners than they exported, a trend driven by the strength of the economy.

Imports increased by 1.1%, reflecting an increase in purchases of industrial supplies and materials. But Americans have bought fewer consumer goods, including cell phones, which are largely made in China. Exports also grew at about the same pace, driven by US fuel and soybean shipments.

The gap with China is down about 12% from the first three months of last year – before Trump begins to impose tariffs on Chinese products in order to make pressure on Beijing for him to go to the negotiating table.

Trump's new pricing threat could make iPhones, toys and shoes more expensive

Tariffs make Chinese-made goods more expensive for US firms, prompting US importers to buy products elsewhere. Some companies have started to change their supply chains to avoid paying customs duties, but this process can take a long time. In the meantime, importers have absorbed some of the costs or passed them on to consumers.

Trump has repeatedly stated that China pays customs duties. Some Chinese companies may choose to take a share of the costs to remain competitive in the US market, but several recent research shows that US consumers and producers are bearing the brunt of the burden.

Chinese negotiators arrived in Washington to continue trade negotiations. On Monday, US trade officials said Beijing had reneged on previous deals this weekend and confirmed that Trump would raise tariffs on the $ 200 billion worth of Chinese goods from 10 percent to 25 percent from Friday.

The president also threatened to add new tariffs on Chinese untaxed goods. This move could hit a long list of consumer goods, including iPhones, toys and shoes, which so far have escaped tariffs.

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