Trump, Xi Set to Seal Trade and Tariff Deal

The trade deficit in the US widened slightly to $57.3 billion in February 2026 from a revised $54.7 billion in February but less than forecasts of a $59.2 billion shortfall. Exports increased 4.2% to a new record high of $314.8 billion led by nonmonetary gold and natural gas. Imports went up 4.3% to $372.1 billion, the highest in eleven months, led by computers, computer accessories, trucks, buses, and special purpose vehicles, crude oil, semiconductors, pharmaceutical preparations and charges for the use of intellectual property. The largest deficit was by far recorded with Taiwan ($-21.1 billion vs $-17.3 billion in January), followed by Mexico ($-16.8 billion vs $-12.8 billion), Vietnam ($-16.5 billion vs $-19 billion) and China ($-13.1 billion vs $-12.5 billion). The gap with the EU decreased to $5.1 billion from $6.1 billion and the shortfall with Canada also narrowed to $0.74 billion from $2.7 billion.

The US trade deficit narrowed sharply to $54.5 billion in January 2026, the lowest since October, following a revised $72.9 billion in December and compared to forecasts of a $66.6 billion gap. Exports jumped 5.5% to a record high of $302.1 billion led by sales of nonmonetary gold, other precious metals, computers, civilian aircraft and computer accessories while sales were down for pharmaceutical preparations. In contrast, imports declined 0.7% to $356.6 billion led by pharmaceutical preparations, trucks, buses, and special purpose vehicles, passenger cars and nonmonetary gold. On the other hand, imports rose for computers and telecommunications equipment. The largest trade gaps were recorded with Vietnam ($-19 billion vs $-17.6 billion in December), Taiwan ($-17.3 billion vs $-19.8 billion), Mexico ($-12.8 billion vs $-14.5 billion), and China ($-12.5 billion vs $-12.4 billion). The deficit with the EU narrowed sharply to $6.1 billion from $11.1 billion.

U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are expected to meet in Paris late next week to discuss potential business agreements ahead of a summit between U.S. President Donald Trump and his counterpart, Xi Jinping, Bloomberg News reported. Talks are likely to center on Chinese purchase commitments for Boeing aircraft and U.S. soybeans. Another key issue will be the future of tariffs imposed by Trump to curb fentanyl flows, after the U.S. Supreme Court struck down the duties. Trump is scheduled to arrive in Beijing at the end of March, with the Paris meeting seen as a precursor to broader negotiations at the leaders’ summit.