Global| Mar 21 2018U.S. Current Account Deficit Increases
by:Tom Moeller
|in:Economy in Brief
Summary
The U.S. current account deficit rose to $128.2 billion during Q4 2017 from $101.5 billion in Q3. It was the largest deficit since Q4 2008. The Q4 deficit figure compared to $124.7 billion expected in the Action Economics Forecast [...]
The U.S. current account deficit rose to $128.2 billion during Q4 2017 from $101.5 billion in Q3. It was the largest deficit since Q4 2008. The Q4 deficit figure compared to $124.7 billion expected in the Action Economics Forecast Survey. As a percent of GDP, the deficit grew to 2.6%. During all of last year, the current account deficit deepened to $466.2 billion, the largest since 2008.
The larger deficit last quarter was due to a deeper $214.3 billion shortfall on goods trade. A 3.7% increase (8.1% y/y) in goods exports was exceeded by a 5.7% rise (8.7% y/y) in imports. During all of last year, goods exports rose 6.5%, the largest rise since 2011. Imports rose 7.0% last year, also the largest increase since 2011.
The surplus on services trade increased slightly to $60.4 billion, but that remained smaller than the Q1'15 peak of $67.1 billion. Services exports rose 1.2% (5.0% y/y) while services imports gained 1.5% (7.8% y/y). For all of 2017, services exports increased 3.8%, the most since 2014. Exports of intellectual property rights rose 2.8% but travel exports declined 1.1%, the first annual decline since 2009. Services imports gained 6.6% for all of 2017. Charges for intellectual property increased 8.9% after an 11.4% rise and travel imports rose 9.4%, the largest increase since 2012.
The surplus on primary income eased to $57.2 billion, but remained near its six-year high. During all of last year, the surplus rose to a record $217.0 billion. The deficit on secondary income increased to $31.5. During all of last year, the deficit eased to 114.8 billion.
From the capital account, the surplus on foreign direct investment shrank to $76.7 billion.
Balance of Payments data are in Haver's USINT database, with summaries available in USECON. The expectations figure is in the AS1REPNA database.
| US Balance of Payments SA | Q4'17 | Q3'17 | Q2'17 | Q4'16 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|
| Current Account Balance ($ Billion) | -128.2 | -101.5 | -125.7 | -114.0 | -466.2 | -451.7 | -434.6 |
| Deficit % of GDP | -2.6 | -2.1 | -2.6 | -2.4 | -2.4 | -2.4 | -2.3 |
| Balance on Goods ($ Billion) | -214.3 | -195.3 | -201.3 | -195.1 | -811.2 | -752.5 | -761.9 |
| Exports | 3.7% | 1.3% | -0.2% | -0.1% | 6.5% | -3.6% | -7.5% |
| Imports | 5.7% | -0.2% | 0.0% | 2.0% | 7.0% | -2.8% | -4.7% |
| Balance on Services ($ Billion) | 60.4 | 60.0 | 59.8 | 61.0 | 242.8 | 247.7 | 261.4 |
| Exports | 1.2% | 1.8% | 0.2% | 1.7% | 3.8% | -0.1% | 1.5% |
| Imports | 1.5% | 2.5% | 2.4% | 0.9% | 6.6% | 2.6% | 2.3% |
| Balance on Primary Income ($ Billion) | 57.2 | 58.5 | 50.9 | 51.3 | 217.0 | 173.2 | 181.0 |
| Balance on Secondary Income ($ Billion) | -31.5 | -24.7 | -33.2 | -31.3 | -114.8 | -120.1 | -115.1 |
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.
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