The U.S. current account deficit narrowed in Q4 to $113.3B from a revised $125.5B in Q3. Consensus expectations had called for $110.0B. The ratio to GDP was 3.1%. For 2010 as a whole, the deficit came to $470.2B, or 3.2% of GDP.

The deficit on goods in Q4 was $156.2B, down from Q3's $170.8B; a resurgence in exports generated the improvement while imports were sluggish, rising just 0.8%. In all of 2010, exports totaled $1,288.7B, up 20.6% from 2009, and imports were $1935.7B, 22.9% above 2009.

The surplus on services was $39.5B in Q4, marginally larger than $38.2B in Q3. This balance moved in a narrow range during the year, averaging $37.8B in the four quarters, making a total of $151.4B for the whole year. Exports of services expanded 8.6% during the year from 2009, with marked turnarounds in travel and passenger fares. Imports of services expanded modestly from quarter to quarter during 2010 and for the year were 6.5% ahead of 2009. "Other transportation", i.e., mainly freight, stood out with a 17.7% bounce after plunging 22.6% during 2009's widespread contraction.

The balance on income eased again in Q4 to $38.6B from $41.3B in Q3 and $42.9B in Q2. The Q4 result reflected a sizable $8.0B increase in US income payments on foreign direct investment; US receipts of direct investment income also gained, but only $4.2B. For all of 2010, the balance on income was a surplus of $163.0B, a new record and a rebound of $41.6B after a deterioration of $30.6B in 2009.

Among financial flows, there was somewhat less movement in Q4 than Q3, with US assets abroad up by $241B compared to $341B in Q3, and foreign flows into the US at $274B, less than Q3's $489B. Foreign investors cut back on all major activities, as they bought fewer securities and less direct investment. On the US side, bank-related flows were smaller in Q4 than in Q3, but direct investment was moderately larger and securities investment about the same. For the year as a whole there were massively larger amounts of international funds flows through the US from both US and foreign investors. US flows abroad came to $1.025Tr and foreign flows here were $1.245Tr.

Balance of Payments data are in Haver's USINT database, with summaries available in USECON.