The numbers: The U.S. trade deficit in goods topped $1 trillion in 2021 for the first time ever, as an economic recovery enabled Americans to snap up a record amount of imports such as toys, cell phones and appliances.
For all of 2021, the trade gap in goods rose to $1.08 trillion from $893.5 billion in the prior year. The deficit in 2020 had also been a record high.
The deficit in goods increased 3% in December to $101 billion from $98 billion, according to an advanced government estimate. It was the biggest monthly increase on record.
Big picture: The speedy rebound in the U.S. economy compared to most other countries — fueled by massive government stimulus — helps explain the record trade deficit. Americans could afford to buy more foreign-made goods, and they did.
Demand for U.S. exports was slower to bounce back because other countries lagged behind in their economic recoveries.
The deficit is expected to subside once other countries catch up, but the U.S. has run large trade gaps for years and there doesn’t appear to be any end in sight.