Global| Dec 19 2017U.S. Current Account Deficit Shrinks Dramatically
by:Tom Moeller
|in:Economy in Brief
Summary
The U.S. current account deficit narrowed sharply to $100.6 billion during Q3 2017 from $124.4 billion in Q2. It was the smallest deficit in three years. The Q3 deficit figure compared to $116.8 billion expected in the Action [...]
The U.S. current account deficit narrowed sharply to $100.6 billion during Q3 2017 from $124.4 billion in Q2. It was the smallest deficit in three years. The Q3 deficit figure compared to $116.8 billion expected in the Action Economics Forecast Survey. As a percent of GDP, the deficit fell to 2.1%.
The smaller deficit last quarter was due to a shallower $195.3 billion deficit on goods trade. Goods exports strengthened 1.4% (4.6% y/y), but imports of goods eased slightly (+5.2% y/y). The surplus on services trade increased to $60.9 billion, but that remained smaller than the Q2'14 peak of $65.8 billion. Services exports improved 1.0% (2.7% y/y) while services imports gained 0.5% (5.3% y/y).
The surplus on primary income increased sharply to $57.0 billion, the largest surplus since Q4 2011. Exports rose 4.2% (14.7% y/y) while imports improved 1.6% (8.6% y/y). The deficit on secondary income shrank to $23.2 billion after deepening to a record $33.2 billion in Q2.
From the capital account, the surplus on foreign direct investment shrank to $76.7 billion.
Balance of Payments data are in Haver's USINT database, with summaries available in USECON. The expectations figure is in the AS1REPNA database.
| US Balance of Payments SA | Q3'17 | Q2'17 | Q1'17 | Q3'16 | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|
| Current Account Balance ($ Billion) | -100.6 | -124.4 | -113.5 | -110.3 | -451.7 | -434.6 | -373.8 |
| Deficit % of GDP | -2.1 | -2.6 | -2.4 | -2.4 | -2.4 | -2.3 | 2.3 |
| Balance on Goods ($ Billion) | -195.3 | -201.4 | -200.6 | -183.4 | -752.5 | -761.9 | -751.5 |
| Exports | 1.4% | -0.2% | 3.6% | 4.6% | -3.6% | -7.5% | 2.6% |
| Imports | -0.2% | 0.0% | 3.3% | 5.2% | -2.8% | -4.7% | 4.0% |
| Balance on Services ($ Billion) | 60.9 | 59.7 | 62.5 | 62.5 | 247.7 | 261.4 | 261.2 |
| Exports | 1.0 | 0.2% | 1.7% | 2.7% | -0.1% | 1.5% | 5.8% |
| Imports | 0.5 | 2.4% | 1.3% | 5.3% | 2.6% | 2.3% | 4.3% |
| Balance on Primary Income ($ Billion) | 57.0 | 50.5 | 50.1 | 41.1 | 173.2 | 181.0 | 210.8 |
| Balance on Secondary Income ($ Billion) | -23.2 | -33.2 | -25.5 | -30.5 | -120.1 | -115.1 | -94.2 |
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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