The US trade deficit widened to a two-year high in July, fueled by a surge in imports of goods and partly reflecting stepped-up efforts by companies to ensure adequate supply ahead of a potential dockworkers’ strike.

The U.S. trade deficit widened sharply in July as businesses front-loaded imports in anticipation of higher tariffs on goods, suggesting that trade could remain a drag on economic growth in the third quarter.

The figures are an indication of strong domestic demand and inconsistent with financial market fears of a recession