AJOT | March 21, 2018 | International Trade
Current-Account Balance, Fourth Quarter
The U.S. current-account deficit increased to $128.2 billion (preliminary) in the fourth quarter of 2017 from $101.5 billion (revised) in the third quarter, according to statistics released by the Bureau of Economic Analysis (BEA). The deficit was 2.6% of current- dollar gross domestic product (GDP) in the fourth quarter, up from 2.1% in the third quarter.
The $26.7 billion increase in the current-account deficit mostly reflected increases in the deficits on goods and secondary income and a decrease in the surplus on primary income.
Exports of goods and services and income receipts
Exports of goods and services and income receipts increased $16.6 billion in the fourth quarter
to $878.8 billion.
• Goods exports increased $14.2 billion to $400.7 billion, mostly reflecting an increase in industrial supplies and materials, primarily petroleum and products.
• Primary income receipts increased $6.0 billion to $243.9 billion, mostly reflecting increases in direct investment income and in portfolio investment income.
• Secondary income receipts decreased $5.9 billion to $35.3 billion, partly offsetting the increases in goods exports and in primary income receipts. The decrease in secondary income receipts mostly reflected a decrease in U.S. government transfers, primarily fines and penalties.
Imports of goods and services and income payments
Imports of goods and services and income payments increased $43.3 billion to $1,006.9 billion.
• Goods imports increased $33.1 billion to $614.9 billion, mostly reflecting increases in industrial supplies and materials, primarily petroleum and products, and in consumer goods except food and automotive.
• Primary income payments increased $7.3 billion to $186.7 billion, primarily reflecting an increase in direct investment income.
Capital Account, Fourth Quarter
The balance on the capital account shifted to a deficit of less than $0.1 billion in the fourth quarter from a surplus of $24.9 billion in the third quarter. The third-quarter transactions reflected receipts from foreign insurance companies for losses resulting from hurricanes Harvey, Irma, and Maria.
Financial Account, Fourth Quarter (tables 1, 6, 7, and 8)
Net U.S. borrowing measured by financial-account transactions was $29.8 billion in the fourth quarter, a decrease from net borrowing of $121.8 billion in the third quarter.
Financial assets
Net U.S. acquisition of financial assets excluding financial derivatives decreased $172.8 billion to $177.9 billion.
• Net U.S. acquisition of portfolio investment assets decreased $95.9 billion to $83.3 billion, reflecting a shift to net U.S. sales of foreign equity and investment fund shares from third-quarter net purchases.
• Transactions in other investment assets shifted to net U.S. liquidation of $10.7 billion in the fourth quarter from net acquisition of $74.7 billion in the third quarter, mostly reflecting a shift to net foreign repayment of loans from third-quarter net U.S provision of loans to foreigners.
Liabilities
Net U.S. incurrence of liabilities excluding financial derivatives decreased $282.6 billion to
$208.4 billion.
• Net U.S. incurrence of portfolio investment liabilities decreased $211.5 billion to $84.9 billion, reflecting a decrease in net foreign purchases of U.S. long-term debt securities and a shift to net foreign sales of U.S. equity and investment fund shares from third-quarter net foreign purchases.
• Net U.S. incurrence of direct investment liabilities decreased $49.6 billion to $54.1 billion, primarily reflecting a shift to net U.S. repayment of debt instrument liabilities from third-quarter net incurrence.
• Net U.S. incurrence of other investment liabilities decreased $21.4 billion to $69.5 billion, reflecting largely offsetting changes in transactions in loan and deposit liabilities. In loans, transactions shifted to net U.S. repayment of loan liabilities from third-quarter net incurrence. In deposits, transactions shifted to net incurrence of deposit liabilities from third-quarter net foreign withdrawal of deposits in the United States.
