US exports just posted their worst drop since the COVID crash. The May tally came in at $179.2 billion—down $9.7 billion, or 5.2%, from April's figure, according to fresh Census Bureau data. That's a sharp U-turn from April's 3.5% gain, and it comes just weeks after President Trump reignited his tariff campaign with a sweeping 10% blanket duty and targeted levies on industrial metals and other sectors. While some of the harshest measures were delayed, the early rollout appears to have jolted global demand—and investors are now watching for knock-on effects.
The damage hit industrial supplies hardest. Shipments of crude oil and metals tumbled 13.6% after a surge in April. Cars fared slightly better: vehicle exports bounced 3.5% after a brutal 20% drop the month before. ING's chief international economist, James Knightley, pointed to a post-announcement rush by overseas buyers to front-load inventory—followed by a sharp pullback once tariffs started kicking in. And while imports held steady, the trade deficit widened to $96.6 billion, missing Wall Street expectations.
Behind the numbers, there's a bigger story unfolding. Companies are now tapping into bloated inventories they built up pre-tariffs, rather than placing fresh orders. Joe Brusuelas, chief economist at RSM, flagged the volatility as a byproduct of tariff uncertainty—and warned it's not going away anytime soon. Until the policy picture clears, the trade data could remain choppy. For investors, this could be a critical signal: the global supply chain isn't just adapting, it's bracing.
