Global| Mar 16 2005U.S. Current Account Deficit Another Record
by:Tom Moeller
|in:Economy in Brief
Summary
The US current account deficit deepened in 4Q04 to a record $187.9B. Consensus expectations had been for a deficit of $183.0B. The figure pulled the full year deficit to $665.9B, 5.7% of GDP. The deficit in merchandise trade [...]
The US current account deficit deepened in 4Q04 to a record $187.9B. Consensus expectations had been for a deficit of $183.0B. The figure pulled the full year deficit to $665.9B, 5.7% of GDP.
The deficit in merchandise trade deteriorated to $183.5B from a revised $167.0B in 3Q. Import growth of 5.4% (20.2% y/y) easily surpassed the strength of exports which grew 1.7% (11.6% y/y).
The surplus on services improved slightly to $12.5B from $11.2B in 3Q. The annual surplus of $48.4B in services trade was, however, barely half the peak in 1997 of $89.9B. Exports of services grew 2.6% in 4Q (7.2% y/y and imports rose 1.2% (10.9% y/y).
From the capital account, US foreign direct investment abroad surged to $101.3B, nearly double the 4Q03 level, and foreign direct investment in the US rose 1.3% to $36.3B, more than triple the 4Q03 level. The deficit of $65B pulled the full year deficit to $133B, about the same as during 2003.
Federal Reserve Board Governor Ben S. Bernanke's speech titled The Global Saving Glut and the U.S. Current Account Deficit can be found here.
| US Int'l Balance of Payments | 4Q '04 | 3Q '04 | Y/Y | 2004 | 2003 | 2002 |
|---|---|---|---|---|---|---|
| Current Account Deficit | $187.9B | $165.9B | $127.0B | $665.9B | $530.7B | $473.9B |
| Goods/Services/Income Deficit | $168.9B | $151.0B | $109.3B | $593.0B | $463.2B | $414.6B |
| Exports | 4.6% | 2.7% | 13.6% | 15.3% | 5.8% | -3.9% |
| Imports | 6.6% | 2.8% | 23.3% | 18.6% | 7.3% | 1.5% |
| Unilateral Transfers Deficit | $19.0B | $14.9B | $17.6B | $72.9B | $67.4B | $59.4B |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
More Economy in Brief
