News Column

U.S. Current Account Deficit Falls 5.7 Percent

September 19, 2013

Japan Economic Newswire

economics

The U.S. current account deficit in the April-June period fell 5.7 percent from the previous quarter to $98.89 billion due mainly to a decline in the goods deficit, the Commerce Department said Thursday.

The deficit in the current account -- the broadest measure of trade in goods and services plus investment income flows -- accounted for 2.4 percent of U.S gross domestic product, down from a revised 2.5 percent in the January-March period.

The amount of the current account deficit in the reporting quarter was the lowest since the third quarter of 2009, the department said in a preliminary report.

The deficit in goods trade fell 2.1 percent from the first quarter to $175.65 billion, the lowest level since the final quarter of 2010, due mainly to strong exports of capital goods such as civilian aircraft as well as consumer items such as food and beverages.

The service trade surplus expanded 1.8 percent to $57.87 billion in the second quarter, the department said.

The deficit in goods and services declined 4 percent from the previous quarter to $117.79 billion.

The shortfall in the current account represents money that the United States has to borrow overseas to pay for the goods and services it imports and to finance investment not covered by U.S. savings.

The income balance -- the earnings Americans receive on their overseas investments minus the earnings foreigners receive on U.S. investments -- posted a surplus of $53.09 billion, up 4.3 percent from the first quarter.

In a separate financial account, the net value of U.S.-owned assets abroad increased $109.65 billion in the April-June quarter, compared with a revised expansion of $229.07 billion in the previous quarter.

Net foreign-owned assets in the United States grew $179.26 billion in the second quarter, following revised growth of $265.54 billion in the previous quarter.

(c) 2013 Kyodo News International, Inc.

Original headline: US Payment UPDATE1


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Source: (c) 2013 Kyodo News International, Inc.


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