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Trade Deficit Surges Amid AI Boom
The U.S. trade deficit hit a 14-month high in May, fueled by a 27.4% spike in imports—especially autos and consumer goods—as businesses stockpile, while exports fell. Middle East tensions eased, but AI-driven tech expansion is now the key culprit, demanding foreign-made equipment. Economists fear this gap could slow Q2 GDP, though hope remains in AI-related service exports. Downgraded growth forecasts from Morgan Stanley and Goldman Sachs reflect mounting concern, as trade has dragged growth for two quarters. Still, imported goods sitting in U.S. inventories may soften the blow by being ready…
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