Mexico’s exports to the US are on the rise as the US’ trade deficit also increases. US’ deficit in the trade of goods with Mexico rose 18.1 percent to a record $9.6 billion, as President Donald Trump threatened Mexico with stinging tariffs.

Around 40 percent of US imports from Mexico are intermediate goods—those that American workers turn into final products. Mexico is also currently the US’ third largest goods trading partner with $611.5 billion in total goods traded during 2018.

Mexico’s exports to its neighbour in 2018 includes vehicles, electrical machinery, machinery, mineral fuels, optical and medical instruments. The central American nation is also the US’ largest supplier of agricultural products.

Mexico was the US’ second largest goods export market in 2018. Many attribute the surge in Mexican exports to the US to the US-Mexico-Canada Agreement, which will replace the North American Free Trade Agreement.

Even though the agreement received Mexico’s Senate’s approval, the US is still to approve the agreement as some lawmakers seek more clarity. However, according to government data, Mexico’s export of services to the US was an estimated $25.3 billion in 2018, 0.6 percent less when compared to 2017.

Mexico contributed to 13.6 percent of overall US imports in 2018. The gap between the US’ exports and imports rose 8.4 percent to $55.5 billion, the highest since December last year.

President Donald Trump accused China and European countries of driving down the value of their currencies to remain competitive.