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Economy in Brief
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Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller September 18, 2020
• Current account deficit grows as exports & imports decline.
• Goods & services balances both deteriorate.
The U.S. current account deficit grew to $170.5 billion in Q2 2020 from $111.5 billion in Q1, revised from $104.2 billion. The Action Economics Forecast Survey anticipated a $159.0 billion deficit. As a percent of GDP, the deficit grew to 3.5%, it's deepest since Q4 2008.
The deficit in goods trade deteriorated to $219.3 billion as exports fell 28.4% (-29.7 y/y). All export categories realized significant declines led by a 58.9% drop (-61.6% y/y) in auto exports. Imports of goods also were off a sharp 14.6% (-20.0% y/y). Goods import declines were widespread with the largest being a 53.3% shortfall (-57.4% y/y) in auto imports.
Services exports declined 22.9% (-29.3% y/y) as travel exports weakened by two-thirds (-72.9% y/y). Export charges for the use of intellectual property fell 9.6% (-12.4% y/y. Imports of services weakened 25.9% (-31.5% y/y) reflecting an 89.7% drop (-92.6% y/y) in travel imports. Imports of charges for the use of intellectual property fell 12.8% (-6.6% y/y).
The surplus on primary income fell to $29.2 billion, the smallest since Q2 2009. Investment income receipts declined 18.4% (-27.3% y/y) while investment income payments weakened 11.7% (-21.0% y/y). The deficit on secondary income lessened slightly to $34.9 billion from its record $37.1 billion in Q1.
Balance of Payments data are in Haver's USINT database, with summaries available in USECON. The expectations figure is in the AS1REPNA database.
| US Balance of Payments SA | Q2'20 | Q1'20 | Q4'19 | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|
| Current Account Balance ($ Billion) | -170.5 | -111.5 | -104.3 | -480.2 | -449.7 | -365.3 |
| Deficit % of GDP | -3.5 | -2.1 | -1.9 | -2.2 | -2.2 | -1.9 |
| Balance on Goods ($ Billion) | -219.3 | -191.7 | -202.5 | -864.3 | -880.3 | -799.3 |
| Exports (% Chg) | -28.4 | -1.9 | 0.1 | -1.5 | 7.7 | 6.8 |
| Imports (% Chg) | -14.6 | -3.0 | -2.9 | -1.6 | 8.5 | 6.8 |
| Balance on Services ($ Billion) | 54.4 | 65.3 | 72.7 | 287.5 | 300.4 | 285.6 |
| Exports (% Chg) | -22.9 | -8.6 | 0.8 | 1.6 | 3.9 | 6.4 |
| Imports (% Chg) | -25.9 | -7.8 | 0.4 | 4.7 | 3.2 | 6.4 |
| Balance on Primary Income ($ Billion) | 29.2 | 52.0 | 62.0 | 236.3 | 251.2 | 257.8 |
| Balance on Secondary Income ($ Billion) | -34.9 | -37.1 | -36.5 | -139.7 | -120.9 | -109.3 |
