Trade war triggers surge in US imports, currency volatility: Fitch
The trade war has resulted in volatility in global trade flows and foreign-exchange rates in recent months, as highlighted in the latest 'Fitch-20 Economic Monitor' by Fitch Ratings. US imports surged in the first quarter of fiscal 2025 as companies rushed to beat the imposition of tariffs. The corollary of this was strong export growth elsewhere, including in Europe.
Growth in US import volumes of goods surged to 30 per cent year-on-year (y-o-y) in March 2025, with imports from Europe rising rapidly. The US trade deficit widened to an all-time high in March, with imports surging and exports steady in the first quarter of fiscal 2025. Import growth then slowed to 2.1 per cent y-o-y in April.
The Fitch-20 Economic Monitor highlights trade and currency volatility from the trade war. US goods imports surged 30 per cent YoY in March 2025 ahead of tariffs, widening the trade deficit, then slowed to 2.1 per cent in April. The US dollar fell 11.7 per cent against the euro since end-2024. Europe saw strong export growth as a result of the rising US imports.
The US dollar has also experienced a sharp and broad weakening after the US tariff shock and since end-2024 has fallen by 11.7 per cent against the euro, as per Fitch Ratings.
The quarterly 'Economic Monitor' (formerly '20/20 Vision') chart pack covers the 20 major economies (the Fitch 20) that are the focus of Fitch's Economics team's global macro analysis.
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