The U.S. trade deficit in goods hit a record $1.2 trillion last year, as American consumers snapped up imported products and a strong U.S. dollar weighed on export growth, reported the New York Times.

“Data released Wednesday morning by the Commerce Department showed that U.S. imports of goods and services grew 6.6% to a record $4.1 trillion, as Americans bought large amounts of auto parts, weight-loss drugs, computers and food from other countries. U.S. exports of goods and services to the world also hit a record, reaching $3.2 trillion in 2024,” wrote the Times.

In 2024, a “strong U.S. dollar made it more expensive for other countries to buy American products, and the United States sold fewer cars, car parts and industrial supplies, like raw materials and machinery, to the world.”

According to the Times, America’s total trade deficit in goods and services, which consists of exports minus imports, grew 17% to $918.4 billion. U.S. oil exports surged, pushing the petroleum surplus to a record $44.9 billion.

The United States recorded its largest trade deficit in goods with China, at $295.4 billion, followed by the European Union, Mexico, Vietnam and Ireland.

Still, economists said the trends were driven largely by the strong performance of the U.S. economy last year, especially compared with the rest of the world.

“A strong U.S. currency makes imports seem relatively cheap for American consumers, and American exports seem relatively expensive in foreign markets, pushing up the trade balance,” reported the outlet.

“For the second year in a row, Mexico was the largest source of U.S. goods imports, sending a record $505.9 billion of products to the United States, followed by China and then Canada.”

Dr. Thomas Weinandy, senior research economist at Upside, will share the U.S. economic outlook for 2025 and beyond at the 2025 NACS State of the Industry Summit in Dallas, April 8-10.