News Release
U.S. International Transactions, 3rd quarter 2008
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Douglas B. Weinberg: | (202) 606-9590 |
U.S. International Transactions: Third Quarter 2008
Current Account
Current Account
The U.S. current-account deficit--the combined balances on trade in goods and services, income, and net unilateral current transfers--decreased to $174.1 billion (preliminary) in the third quarter of 2008 from $180.9 billion (revised) in the second quarter. The decrease was accounted for by increases in the surpluses on income and on services and decreases in the deficit on goods and in net unilateral current transfers to foreigners. Goods and services The deficit on goods and services decreased to $176.5 billion in the third quarter from $180.1 billion in the second. Goods The deficit on goods decreased to $214.7 billion in the third quarter from $216.3 billion in the second. Goods exports increased to $346.5 billion from $337.3 billion. More than half of the increase was accounted for by a rise in industrial supplies and materials, largely reflecting increases in energy products and in chemicals. Automotive vehicles and parts, capital goods, and consumer goods also increased. Goods imports increased to $561.2 billion from $553.6 billion. The increase was more than accounted for by an increase in petroleum and products. Nonpetroleum products decreased slightly, as decreases in automotive vehicles and parts and in capital goods were largely offset by increases in nonpetroleum industrial supplies and materials and in consumer goods. Services The surplus on services increased to $38.2 billion in the third quarter from $36.2 billion in the second. Services receipts increased to $142.5 billion from $138.2 billion. The increase was largely accounted for by increases in travel, in other private services (which includes items such as business, professional, and technical services, insurance services, and financial services), in passenger fares, and in royalties and license fees. Services payments increased to $104.3 billion from $101.9 billion. The increase was largely accounted for by increases in royalties and license fees and in other private services. Income The surplus on income increased to $30.8 billion in the third quarter from $28.2 billion in the second. Investment income Income receipts on U.S.-owned assets abroad decreased to $193.9 billion from $195.7 billion. The decrease was more than accounted for by a decrease in direct investment receipts. In contrast, other private receipts (which consists of interest and dividends) and U.S. government receipts increased. Income payments on foreign-owned assets in the United States decreased to $161.3 billion from $165.7 billion. The decrease was more than accounted for by decreases in direct investment payments and in U.S. government payments. In contrast, other private payments increased. Compensation of employees Receipts for compensation of U.S. workers abroad were virtually unchanged at $0.7 billion, and payments for compensation of foreign workers in the United States were also virtually unchanged, at $2.5 billion. Unilateral current transfers Net unilateral current transfers to foreigners were $28.4 billion in the third quarter, down from $29.0 billion in the second. The decrease was largely accounted for by a decrease in private remittances and other transfers. Capital Account Net capital account payments (outflows) were virtually unchanged at $0.6 billion in the third quarter. Financial Account Net financial inflows--net acquisitions by foreign residents of assets in the United States less net acquisitions by U.S. residents of assets abroad-- were $135.2 billion in the third quarter, up from $122.9 billion in the second. Net acquisitions by foreign residents of assets in the United States picked up, and transactions by U.S. residents resulted in a smaller decrease in U.S.-owned assets abroad in the third quarter than in the second quarter. U.S.-owned assets abroad U.S.-owned assets abroad decreased $9.5 billion in the third quarter, following a decrease of $102.7 billion in the second. U.S. claims on foreigners reported by U.S. banks decreased $152.0 billion in the third quarter, following a decrease of $213.9 billion in the second. Transactions in foreign securities shifted to net U.S. sales of $86.8 billion in the third quarter from net U.S. purchases of $33.6 billion in the second. Transactions in foreign stocks shifted to net U.S. sales of $14.8 billion from net U.S. purchases of $21.4 billion. Transactions in foreign bonds shifted to net U.S. sales of $72.0 billion from net U.S. purchases of $12.2 billion. U.S. direct investment abroad increased $56.9 billion in the third quarter, following an increase of $84.0 billion in the second. The slowdown resulted from a shift from an increase to a decrease in net intercompany debt investment abroad and a slowdown in reinvested earnings. In contrast, net equity capital investment picked up. U.S. official reserve assets increased $0.2 billion in the third quarter, following an increase of $1.3 billion in the second. U.S. government assets other than official reserve assets increased $226.0 billion in the third quarter, following an increase of $41.6 billion in the second. The exceptionally large third-quarter increase resulted from drawings on temporary reciprocal currency arrangements between the U.S. Federal Reserve System and foreign central banks that do not meet the strict definition of U.S. reserve assets. Foreign-owned assets in the United States Foreign-owned assets in the United States increased $125.7 billion in the third quarter, following an increase of $22.7 billion in the second. U.S. liabilities to foreigners reported by U.S. banks decreased $147.9 billion in the third quarter, following a decrease of $256.6 billion in the second. Net foreign purchases of U.S. Treasury securities were $89.5 billion in the third quarter, up from $65.7 billion in the second. Transactions in U.S. securities other than U.S. Treasury securities shifted to net foreign sales of $89.2 billion in the third quarter from net foreign purchases of $17.1 billion in the second. The shift largely resulted from a shift to net foreign sales of $34.7 billion of U.S. corporate bonds from net foreign purchases of $50.6 billion. In addition, net foreign sales of U.S. federally sponsored agency bonds were $57.0 billion, up from $32.8 billion. In contrast, transactions in U.S. stocks shifted to net foreign purchases of $2.5 billion from net foreign sales of $0.7 billion. Foreign direct investment in the United States increased $66.1 billion in the third quarter, following an increase of $105.3 billion in the second. The slowdown almost entirely resulted from a slowdown in net intercompany debt investment in the United States. In addition, reinvested earnings fell slightly. In contrast, net equity capital investment in the United States picked up. Foreign official assets in the United States increased $117.7 billion in the third quarter, following an increase of $145.4 billion in the second. Net U.S. currency shipments to foreigners were $5.8 billion in the third quarter, up from $0.2 billion in the second. The statistical discrepancy--errors and omissions in recorded transactions--was a positive $39.5 billion in the third quarter, compared with a positive $58.7 billion in the second. In the third quarter, the U.S. dollar appreciated 4 percent on a trade- weighted quarterly average basis against a group of 7 major currencies. Revisions The second-quarter international transactions are revised from previously published estimates. The current-account deficit was revised to $180.9 billion from $183.1 billion. The goods deficit was unrevised at $216.3 billion; the services surplus was revised to $36.2 billion from $35.8 billion; the income surplus was revised to $28.2 billion from $27.3 billion; and unilateral current transfers were revised to net outflows of $29.0 billion from $29.9 billion. Net financial inflows were revised to $122.9 billion from $136.7 billion. * * * Release dates in 2009: Fourth quarter and year 2008...................March 18, 2009 (Wednesday) First quarter 2009..............................June 17, 2009 (Wednesday) Second quarter 2009........................September 16, 2009 (Wednesday) Third quarter 2009..........................December 16, 2009 (Wednesday) * * *