Trade Deficit Jumps, Tariffs Have Little Impact So Far

Ahead of State of the Union, new economic data shows mixed signals on jobs, trade, and consumer spending

Published on Feb. 27, 2026

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New economic data shows the U.S. trade deficit jumped to $70 billion in December, with the full-year 2025 deficit just over $900 billion. Economists say President Trump's tariffs have not substantially altered America's trade imbalance yet. Meanwhile, jobless claims fell to 206,000 last week, beating analysts' predictions, but overall hiring has been slow outside of healthcare and social assistance. Walmart reported strong earnings, but noted lower-income households are still struggling.

Why it matters

The state of the U.S. economy, from trade deficits to the job market, is a key focus ahead of the President's State of the Union address. These economic indicators provide insight into the overall health and challenges facing the economy.

The details

The U.S. trade deficit jumped to $70 billion in December, fueled by a drop in gold exports. The full-year 2025 trade deficit was just over $900 billion, down slightly from 2024. Economists say President Trump's tariffs have not substantially altered America's trade imbalance so far. On the jobs front, 206,000 people filed jobless claims last week, the fewest since early January and beating analysts' predictions. However, data shows the labor market has seen slow hiring, with the bulk of job creation in healthcare and social assistance. Walmart reported strong earnings for the final quarter of 2025, but noted lower-income households are still struggling.

  • The U.S. trade deficit data is for December 2025.
  • The full-year 2025 trade deficit figure is for the entire year.
  • The jobless claims data is for the week ending in early February 2026.

The players

Abby Hall

Associate Professor of Economics at the University of Tampa.

Mark Hamrick

Senior Economic Analyst with Bankrate.

John Furner

CEO of Walmart.

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What they’re saying

“This idea that were going to see a significant reduction in the trade deficit, especially over a short period of time — definitely not the case.”

— Abby Hall, Associate Professor of Economics (3newsnow.com)

“The bulk of jobs creation's really been focused in two areas, health care and social assistance. So if you're working in those sectors, you probably are feeling pretty good. If you're working elsewhere, perhaps not so good.”

— Mark Hamrick, Senior Economic Analyst (3newsnow.com)

“For households earning below $50,000, we continue to see the wallets are stretched, and in some cases, people are managing spending paycheck to paycheck.”

— John Furner, CEO (3newsnow.com)

What’s next

President Trump is expected to address the state of the U.S. economy during his upcoming State of the Union address.

The takeaway

The latest economic data paints a mixed picture, with the trade deficit continuing to grow despite tariffs, while the job market shows signs of slow hiring outside of certain sectors. This underscores the complex challenges facing the U.S. economy that the President will likely need to address.