US current account deficit 4-year record low
The US current account deficit for the third quarter of 2013 was $94.8 billion, a 4-year record low, according to figures published by the Bureau of Economic Analysis1, part of the US Commerce Department.
A country’s current account measures the flow in and out of goods, services, income, and net unilateral current transfers.
According to the Commerce Department, the US current account deficit for Q3 2013 was the smallest since Q3 2009.
At 2.2% of GDP (gross domestic product) in Q3 2013 compared to 2.3% in Q2 2013, it was the smallest share since Q1 1998. In 2005, the deficit had reached 6.2% of GDP.
According to a Reuter’s poll of economists, the US current account deficit was forecast to widen to $100 billion.
US current account – deficit on goods
The deficit on goods was $178.6 billion in Q3 2013 compared to $175.7 billion in the previous quarter.
Goods exports totaled $397.6 billion in the third quarter compared to $394.7 in the previous one.
Goods export growth was mainly driven by beverages, feeds and foods. According to the Commerce Department, “The increase in industrial supplies and materials was more than accounted for by an increase in petroleum and products.”
Exports in consumer goods fell, mostly due to a decline in foreign sales of jewelry, gems and collectibles.
Goods imports rose to $576.2 billion in Q3 2013 from $570.4 billion in Q2 2013.
The main increases in imports were in trucks, special purpose vehicles, buses, and vehicle parts and engines.
The Commerce department wrote: “An increase in imports of industrial supplies and materials was more than accounted for by increased imports of petroleum and products. An increase in capital goods imports partly reflected an increase in computers, peripherals, and parts.”
US current account – surplus on services
The surplus on services rose to $57.9 billion in Q3 2013 compared to $57.6 billion in Q2 2013.
Services exports rose from $170.1 billion in the second quarter to $170.9 billion in the third. The largest increases in services exports were in license fees, royalties and travel.
Services imports rose from $112.5 billion in the second quarter to $113 billion in the third. The largest increases were in freight and port services, technical services, and other private services (mainly in business).
Surplus on income
The surplus on income increased by $4 billion, from $56 billion in Q2 2013 to $60 billion in Q3 2013.
Investment income – income receipts on US-owned assets overseas rose from $193.8 billion in the second quarter to $194.9 billion in the third.
Income payments – on foreign-owned assets in the US fell from $135.6 billion in Q2 2013 to $132.8 billion in Q3 2013.
Compensation of employees – US non-residents living abroad was $1.7 billion, while payments to foreign residents by US residents was $3.8 billion. Both figures remained unchanged in the third quarter compared to the second.