American companies rushed to secure foreign goods in July, ahead of planned tariff increases at the beginning of August, thereby further widening the US trade deficit.

Rather than decreasing the deficit – as Trump claimed would happen – the tariff chaos and continued flip-flops have created insecurity among U.S.-based businesses, which are concerned about rising costs due to retaliatory tariffs.

The Commerce Department’s advance estimate showed that the goods trade deficit grew by 22.1% to a staggering $103.6 billion – up sharply from the $84.9 billion seen in June.

This deficit was far wider than expected; many economists had predicted that the deficit would only widen to $87.7 billion.

Companies need foreign products and input goods – many of which are not available from American companies – to continue operating their businesses and employing US workers.

While the deficit hit a record $162 billion in March and has fluctuated in the months since, the continued widening is expected to impact U.S. GDP in Q3.

Ultimately, until US firms see a stabilization of trade policy – and leadership from the White House – it is likely that the Administration’s goal of permanently reducing the trade deficit is nothing more than a talking point for their base.