IndiaDataHub

Month-on-month movements drove much of December’s widening, with exports declining 3% MoM and imports rising 4% MoM (seasonally adjusted). For the full year 2025, the U.S. goods trade deficit stood at $1.23tn, up 2.1% from 2024, as imports rose $149.3bn (4.6%), outpacing the $123.5bn (6%) increase in exports.

Across key partners, exports to China declined for a twelfth consecutive month, while China’s share of total U.S. imports fell to 7.5% from 13.2% a year earlier. In contrast, trade with Taiwan strengthened sharply, with imports rising over 144% YoY, alongside the pickup in U.S.–India trade flows.

As per preliminary DGCA data, December’s contraction in domestic passenger traffic had sharp divergences at the airline level.

IndiGo recorded an 11% YoY decline, its weakest performance since January 2022, amid operational disruptions following stricter enforcement of pilot duty-time regulations.

The disruption meant strong gains for competing carriers as Star Air posted 73% YoY growth, its highest since September 2024, and crossed the one-lakh passenger mark during the month.

The Air India Group (Air India + Air India Express) also reported 7% YoY growth, improving from 4.8% in November, while carrying its highest-ever monthly passenger volume of over 42 lakh passengers.

Services exports recorded strong momentum in December, rising 21.9% month-on-month and 13.3% year-on-year, the first instance of double-digit annual growth in three months.

Services imports increased 7.4% YoY, following a contraction in November (-2.04%), contributing to the expansion in the services trade surplus.

In November, U.S. exports grew 6.1% YoY, slowing from 15.8% in October, while imports rose 6.5% month-on-month but remained lower YoY.

Exports to China declined for the eleventh consecutive month, with China’s share of U.S. exports falling to 3.8%, while exports to Taiwan rose 43.6% YoY and exports to India increased 4.2% YoY.

December’s pickup followed a 7.2% expansion in November, a clear improvement over the 3.7% growth recorded a year earlier.

The acceleration was supported by strength in manufacturing and mining, alongside a return to growth in electricity output, while consumer durables and infrastructure goods continued to post double-digit gains.

Goods exports grew 1.9% YoY, a sharp slowdown from the strong growth recorded in the previous month (19.4% YoY). The growth slowed across several major categories in December, with engineering and electronics moderating sharply, while gems & jewellery and petroleum exports contracted after strong growth in November.

On the other side, a rebound from a contraction in November (-1.9% YoY) saw imports increasing 8.8% YoY. Petroleum imports recovered from the previous month’s decline, while gold imports remained in contraction, though the pace of decline eased.

Cash holdings of domestic equity mutual funds has dropped in the last few months - from 7% in April 2025 to ~5.5% in December which is lowest since 1H of 2024! The decline is especially sharp in Large cap, Small cap and Value funds. For more read this: https://insights.indiadatahub.com/block/178

December saw China’s exports rise 6.6% YoY to USD 357.78bn, while imports increased 5.7% YoY to USD 243.64bn, lifting the monthly trade surplus to USD 114.14bn, the highest in six months.

Export growth was supported by stronger shipments to the European Union and Southeast Asia, which helped offset the continued decline in trade with the U.S.

Food prices in the US increased 3.1% YoY in December (from 2.7% in November), while the energy index rose 2.3% (4.2% in Nov), keeping overall inflation readings broadly stable on a year-on-year basis.

Core inflation picked up in December, rising to 4.6% YoY from 3.4% in November.

At the same time, headline inflation has remained well below last year’s levels, even as it edged higher on a month-to-month basis.