FOR WIRE TRANSMISSION: 8:30 A.M. EST, TUESDAY, December 17, 2013 Sarah P. Scott: (202) 606-9286 BEA 13-60 U.S. International Transactions: Third Quarter 2013 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 $94.8 billion (preliminary) in the third quarter from $96.6 billion (revised) in the second quarter. The deficit decreased to 2.2 percent of current-dollar gross domestic product (GDP) from 2.3 percent in the second quarter. The decrease in the current-account deficit was more than accounted for by an increase in the surplus on income. A decrease in net outflows of unilateral current transfers—such as government grants, government pensions and other transfers, and private remittances—and an increase in the surplus on services also contributed to the decrease. These changes were partly offset by an increase in the deficit on goods. Goods and services The deficit on goods and services increased to $120.7 billion in the third quarter from $118.1 billion in the second. Goods The deficit on goods increased to $178.6 billion in the third quarter from $175.7 billion in the second. Goods exports increased to $397.6 billion from $394.7 billion. Four of the six major end- use export categories increased. The largest increases in exports were in industrial supplies and materials and in foods, feeds, and beverages. The increase in industrial supplies and materials was more than accounted for by an increase in petroleum and products. The increase in foods, feeds, and beverages was largely due to increases in grains and preparations exports and in soybean exports. The largest decrease was in consumer goods and was mostly due to a decrease in exports of gems, jewelry, and collectibles, which is a component of durable goods (table 2a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=3). Goods imports increased to $576.2 billion from $570.4 billion. Three of the six major end- use import categories increased; the increases in each of these three categories were larger than the combined decrease of the other three categories. The largest increase in imports was in automotive vehicles, parts, and engines; much of that increase was in trucks, buses, and special purpose vehicles. An increase in imports of industrial supplies and materials was more than accounted for by increased imports of petroleum and products. An increase in capital goods imports partly reflected an increase in computers, peripherals, and parts (table 2a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=3). Services The surplus on services increased to $57.9 billion in the third quarter from $57.6 billion in the second. Services exports increased to $170.9 billion from $170.1 billion. Exports increased in five of the seven major services categories. The largest increases were in travel and in royalties and license fees (table 3a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=7). Services imports increased to $113.0 billion from $112.5 billion. Imports increased in four of the seven major services categories. The largest increases were in other private services, primarily in business, professional, and technical services, and in other transportation, which includes freight and port services (table 3a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=7). Income The surplus on income increased to $60.0 billion in the third quarter from $56.0 billion in the second. Investment income Income receipts on U.S.-owned assets abroad increased to $194.9 billion from $193.8 billion. The increase was accounted for by increases in other private receipts, which consists of interest and dividends, and direct investment receipts. U.S. government receipts decreased (table 4) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=11). Income payments on foreign-owned assets in the United States decreased to $132.8 billion from $135.6 billion. The decrease was more than accounted for by a decrease in direct investment payments. Other private payments increased (table 4) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=11). Compensation of employees Receipts for compensation of U.S. residents paid by nonresidents remained at $1.7 billion in the third quarter. Payments for compensation of foreign residents paid by U.S. residents remained at $3.8 billion in the third quarter. Unilateral current transfers Net unilateral current transfers to foreigners were $34.1 billion in the third quarter, down from $34.5 billion in the second. The decrease reflected decreases in private remittances and other transfers and in U.S. government pensions and other transfers that more than offset an increase in U.S. government grants. Capital Account Net capital-account transactions are not available for the third quarter because source data are not yet available. In the second quarter, net payments were $0.2 billion. Financial Account Net financial inflows were $67.3 billion in the third quarter, up from $65.5 billion in the second. U.S.-owned assets abroad and foreign-owned assets in the United States both increased less than in the second quarter; outflows of U.S.-owned assets abroad declined more than inflows of foreign-owned assets in the United States. Financial derivatives shifted to net outflows in the third quarter from net inflows in the second quarter. U.S.-owned assets abroad U.S.-owned assets abroad increased $74.3 billion in the third quarter after increasing $106.2 billion in the second. U.S. official reserve assets decreased $1.0 billion in the third quarter after decreasing $0.2 billion in the second. The third-quarter decrease reflected a decrease in the U.S. reserve position in the International Monetary Fund. U.S. government assets other than official reserve assets decreased $0.9 billion in the third quarter after decreasing $3.1 billion in the second. Outflows of U.S. direct investment abroad were $95.8 billion in the third quarter, down from $97.0 billion in the second. The decrease was more than accounted for by a shift to net inflows of intercompany debt in the third quarter from net outflows in the second quarter. This shift was partly offset by increases in equity investment and reinvested earnings (table 7a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=15). U.S. purchases of foreign securities exceeded sales (net purchases) by $47.4 billion in the third quarter, down from $79.4 billion in the second. Net purchases of foreign stocks were $23.0 billion, down from $78.4 billion. Net purchases of foreign bonds were $24.4 billion, up from $1.0 billion (table 8a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=19). U.S. claims on unaffiliated foreigners reported by U.S. nonbanking concerns decreased $4.3 billion in the third quarter after increasing $59.7 billion in the second. An example of these claims is deposits of U.S. nonbanks at foreign banks (table 9a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=21). U.S. claims on foreigners reported by U.S. banks and securities brokers decreased $62.8 billion in the third quarter after decreasing $126.6 billion in the second. Examples of these claims are deposits of U.S. banks at foreign banks and loans by U.S. banks to foreigners (table 10a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=23). Foreign-owned assets in the United States Foreign-owned assets in the United States increased $148.2 billion in the third quarter after increasing $168.2 billion in the second. Foreign official assets in the United States increased $68.5 billion in the third quarter after decreasing $6.6 billion in the second. The third-quarter shift reflected shifts to net purchases of U.S. government securities from net sales and an increase in U.S. liabilities reported by U.S. banks and securities brokers following a decrease. Inflows of foreign direct investment in the United States were $44.2 billion in the third quarter, up from $40.6 billion in the second. The increase was more than accounted for by higher equity investment; reinvested earnings were lower and net outflows of intercompany debt investment were higher than in the second quarter (table 7a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=15). Foreign private purchases of U.S. Treasury securities exceeded sales (net purchases) by $63.4 billion in the third quarter, a shift from net sales of $6.1 billion in the second quarter. The shift to net purchases reflected a shift to net purchases of U.S. Treasury bonds and notes that was partly offset by an increase in net sales of U.S. Treasury bills and certificates (table 8a (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=19) and (table 11a (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=25)). Foreign private purchases of U.S. securities other than U.S. Treasury securities exceeded sales (net purchases) by $131.6 billion in the third quarter, a shift from net sales of $43.2 billion in the second. Net purchases of U.S. stocks were $58.6 billion, a shift from net sales of $47.1 billion. Net purchases of U.S. corporate bonds were $71.7 billion, up from $28.8 billion. Net purchases of U.S. federally sponsored agency bonds were $1.3 billion, a shift from net sales of $24.9 billion (table 8a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=19). Net shipments of U.S. currency to foreign countries were $12.7 billion in the third quarter following net shipments of $9.5 billion in the second. U.S. liabilities to unaffiliated foreigners reported by U.S. nonbanking concerns decreased $60.8 billion in the third quarter after increasing $18.9 billion in the second. An example of these liabilities is loans by foreign banks to U.S. nonbanks (table 9a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=21). U.S. liabilities to foreigners reported by U.S. banks and securities brokers, other than those recorded under foreign official assets, decreased $111.5 billion in the third quarter after increasing $155.1 billion in the second. Examples of these liabilities are deposits of foreign residents at U.S. banks and loans by foreign banks to U.S. banks (table 11a) (www.bea.gov/iTable/iTableHtml.cfm?reqid=6&step=3&isuri=1&600=25). Financial derivatives Net outflows of financial derivatives were $6.6 billion in the third quarter after net inflows of $3.5 billion in the second. * * * The statistical discrepancy—the amount that balances the sum of the recorded credits and debits across all the accounts in the international transactions accounts—was $27.6 billion in the third quarter compared with $31.3 billion in the second. In the third quarter, the U.S. dollar appreciated 0.1 percent on a trade-weighted quarterly average basis against a group of 7 major currencies, after appreciating 2.2 percent in the second quarter. Exchange rate data are based on Federal Reserve Statistical Release H.10. Revisions The second-quarter 2013 international transactions are revised from previously published statistics. The current-account deficit was revised downward to $96.6 billion from $98.9 billion. The goods deficit remained at $175.7 billion; the services surplus was revised downward to $57.6 billion from $57.9 billion; the income surplus was revised upward to $56.0 billion from $53.1 billion; and net outflows of unilateral current transfers were revised upward to $34.5 billion from $34.2 billion. Net financial inflows were revised downward to $65.5 billion from $73.1 billion, reflecting a larger downward revision to inflows of foreign-owned assets in the United States than the downward revision to outflows of U.S.-owned assets abroad. * * * Release dates in 2014: Fourth Quarter and Year 2013..................................March 19, 2014 (Wednesday) First Quarter 2014 and Annual Revisions........................June 18, 2014 (Wednesday) Second Quarter 2014.......................................September 17, 2014 (Wednesday) Third Quarter 2014.........................................December 17, 2014 (Wednesday) * * * BEA’s national, international, regional, and industry statistics; the SURVEY OF CURRENT BUSINESS; and BEA news releases are available without charge on BEA’s Web site at www.bea.gov. At the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements. ________________ NOTE: This news release is available on BEA’s Web site (www.bea.gov) along with Highlights (www.bea.gov/newsreleases/international/transactions/2013/pdf/trans313_fax.pdf) related to this release, the latest detailed statistics (www.bea.gov/iTable/index_ita.cfm) for U.S. international transactions, and a description of the estimation methods (www.bea.gov/methodologies/index.htm#international_meth) used to compile them. The third-quarter statistics in this release are preliminary and will be revised on March 19, 2014. All links in the text of this release—including archived versions of this release—refer to the latest available statistics. December 17, 2013 Table 1. U.S. International Transactions [Millions of dollars, quarters seasonally adjusted] 2012 2013 Change: (Credits +, debits -)/1/ 2012 2013:II to I II III IV I II r III p 2013:III Current account 1 Exports of goods and services and income receipts............................................. 2,986,949 742,117 746,799 744,602 753,430 749,493 760,170 765,110 4,940 2 Exports of goods and services............................................................. 2,210,585 548,046 553,702 552,275 556,561 557,883 564,728 568,522 3,794 3 Goods, balance of payments basis...................................................... 1,561,239 387,559 391,867 391,474 390,339 390,705 394,653 397,602 2,949 4 Services.............................................................................. 649,346 160,487 161,835 160,802 166,222 167,178 170,074 170,920 846 5 Transfers under U.S. military agency sales contracts.............................. 18,520 4,578 4,429 4,529 4,984 4,870 4,797 4,908 111 6 Travel............................................................................ 126,214 30,243 31,369 32,079 32,523 33,911 34,632 35,165 533 7 Passenger fares................................................................... 39,360 9,649 10,069 9,846 9,796 10,223 10,306 10,174 -132 8 Other transportation.............................................................. 43,855 11,031 11,108 10,856 10,860 11,504 11,382 11,052 -330 9 Royalties and license fees........................................................ 124,182 31,293 30,726 30,827 31,336 31,666 32,256 32,666 410 10 Other private services............................................................ 294,527 73,059 73,459 71,969 76,041 74,344 75,983 76,210 227 11 U.S. government miscellaneous services............................................ 2,688 634 676 695 683 661 719 745 26 12 Income receipts........................................................................... 776,364 194,071 193,097 192,327 196,869 191,610 195,443 196,588 1,145 13 Income receipts on U.S.-owned assets abroad........................................... 770,079 192,550 191,551 190,748 195,230 189,968 193,789 194,928 1,139 14 Direct investment receipts........................................................ 470,233 119,118 115,731 115,735 119,649 113,783 115,953 116,391 438 15 Other private receipts............................................................ 297,891 72,752 75,384 74,554 75,201 75,704 77,418 78,168 750 16 U.S. government receipts.......................................................... 1,954 680 436 459 380 481 418 369 -49 17 Compensation of employees............................................................. 6,286 1,521 1,546 1,579 1,639 1,642 1,653 1,660 7 18 Imports of goods and services and income payments............................................. -3,297,677 -830,188 -824,644 -819,001 -823,844 -821,245 -822,295 -825,850 -3,555 19 Imports of goods and services............................................................. -2,745,240 -690,993 -689,004 -681,304 -683,939 -680,516 -682,850 -689,260 -6,410 20 Goods, balance of payments basis...................................................... -2,302,714 -581,163 -578,355 -570,454 -572,742 -570,162 -570,390 -576,232 -5,842 21 Services.............................................................................. -442,527 -109,830 -110,649 -110,850 -111,197 -110,354 -112,460 -113,028 -568 22 Direct defense expenditures....................................................... -24,734 -6,479 -6,253 -6,120 -5,882 -5,696 -5,699 -5,525 174 23 Travel............................................................................ -83,451 -20,960 -21,139 -20,709 -20,643 -21,122 -21,531 -21,547 -16 24 Passenger fares................................................................... -34,654 -8,466 -8,784 -8,735 -8,669 -9,138 -9,241 -9,185 56 25 Other transportation.............................................................. -55,445 -13,614 -13,864 -13,978 -13,989 -14,421 -14,640 -14,899 -259 26 Royalties and license fees........................................................ -39,889 -9,742 -9,978 -10,314 -9,854 -10,454 -10,249 -10,450 -201 27 Other private services............................................................ -201,227 -49,769 -49,832 -50,249 -51,378 -48,864 -50,387 -50,717 -330 28 U.S. government miscellaneous services............................................ -3,127 -800 -799 -745 -782 -659 -714 -706 8 29 Income payments........................................................................... -552,437 -139,195 -135,639 -137,697 -139,905 -140,730 -139,445 -136,590 2,855 30 Income payments on foreign-owned assets in the United States.......................... -537,815 -135,665 -131,898 -133,996 -136,256 -137,070 -135,607 -132,753 2,854 31 Direct investment payments........................................................ -176,747 -46,476 -41,436 -44,874 -43,961 -44,629 -43,305 -40,250 3,055 32 Other private payments............................................................ -233,336 -56,638 -58,311 -57,394 -60,993 -61,403 -62,083 -62,355 -272 33 U.S. government payments.......................................................... -127,732 -32,551 -32,151 -31,728 -31,302 -31,038 -30,219 -30,148 71 34 Compensation of employees............................................................. -14,622 -3,530 -3,742 -3,701 -3,649 -3,660 -3,838 -3,837 1 35 Unilateral current transfers, net............................................................. -129,688 -32,771 -32,668 -32,343 -31,906 -33,143 -34,488 -34,100 388 36 U.S. government grants.................................................................... -46,090 -11,912 -11,473 -11,823 -10,882 -11,061 -11,361 -12,260 -899 37 U.S. government pensions and other transfers.............................................. -3,685 -1,649 -1,435 -1,270 668 -756 -1,619 -984 635 38 Private remittances and other transfers................................................... -79,913 -19,210 -19,761 -19,250 -21,692 -21,327 -21,508 -20,856 652 December 17, 2013 Table 1. U.S. International Transactions (Continued) [Millions of dollars, quarters seasonally adjusted] 2012 2013 Change: (Credits +, debits -)/1/ 2012 2013:II to I II III IV I II r III p 2013:III Capital account 39 Capital account transactions, net............................................................. 6,956 -1 -241 -470 7,668 -40 -227 n.a. n.a. Financial account 40 U.S.-owned assets abroad, excluding financial derivatives (increase/financial outflow (-)).............................................................. -97,469 93,519 192,062 -267,054 -115,996 -229,070 -106,201 -74,295 31,906 41 U.S. official reserve assets.............................................................. -4,460 -1,233 -3,289 -833 895 -876 191 1,001 810 42 Gold.................................................................................. 0 0 0 0 0 0 0 0 0 43 Special drawing rights................................................................ -37 -11 -10 -10 -6 -5 -6 -5 1 44 Reserve position in the International Monetary Fund................................... -4,032 -1,078 -3,179 -744 969 -755 287 1,071 784 45 Foreign currencies.................................................................... -391 -144 -100 -79 -68 -116 -90 -65 25 46 U.S. government assets, other than official reserve assets................................ 85,331 51,087 16,650 15,206 2,388 -446 3,115 850 -2,265 47 U.S. credits and other long-term assets............................................... -8,202 -2,655 -2,538 -1,038 -1,971 -1,865 -3,934 -876 3,058 48 Repayments on U.S. credits and other long-term assets................................. 2,546 386 680 847 633 461 731 579 -152 49 U.S. foreign currency holdings and U.S. short-term assets............................. 90,987 53,356 18,508 15,397 3,726 958 6,318 1,146 -5,172 50 U.S. private assets....................................................................... -178,341 43,665 178,701 -281,428 -119,279 -227,748 -109,507 -76,146 33,361 51 Direct investment..................................................................... -388,293 -113,038 -86,202 -93,635 -95,418 -84,122 -97,004 -95,813 1,191 52 Foreign securities.................................................................... -144,823 2,276 -22,920 -51,183 -72,996 -133,783 -79,359 -47,391 31,968 53 U.S. claims on unaffiliated foreigners reported by U.S. nonbanking concerns........... -25,723 -67,175 16,793 6,325 18,334 -22,437 -59,730 4,290 64,020 54 U.S. claims reported by U.S. banks and securities brokers............................. 380,498 221,602 271,030 -142,935 30,801 12,594 126,586 62,768 -63,818 55 Foreign-owned assets in the United States, excluding financial derivatives (increase/financial inflow (+))............................................................... 543,884 177,381 -176,468 300,570 242,401 265,544 168,191 148,154 -20,037 56 Foreign official assets in the United States.............................................. 393,922 144,468 57,374 107,684 84,396 126,871 -6,577 68,514 75,091 57 U.S. government securities............................................................ 314,660 124,225 42,927 87,309 60,199 96,603 -23,558 35,193 58,751 58 U.S. Treasury securities.......................................................... 433,155 143,100 96,213 100,571 93,271 118,533 -11,974 15,972 27,946 59 Other............................................................................. -118,495 -18,875 -53,286 -13,262 -33,072 -21,930 -11,584 19,221 30,805 60 Other U.S. government liabilities..................................................... 8,241 2,939 2,773 1,722 807 1,608 3,546 3,105 -441 61 U.S. liabilities reported by U.S. banks and securities brokers.................... -1,572 -14,458 406 7,066 5,414 20,061 -9,354 30,052 39,406 62 Other foreign official assets..................................................... 72,593 31,762 11,268 11,587 17,976 8,599 22,789 164 -22,625 63 Other foreign assets in the United States................................................. 149,962 32,913 -233,842 192,886 158,005 138,673 174,768 79,640 -95,128 64 Direct investment..................................................................... 166,411 35,756 49,524 38,839 42,292 28,624 40,556 44,177 3,621 65 U.S. Treasury securities.............................................................. 156,385 64,974 -4,652 62,548 33,515 50,780 -6,065 63,414 69,479 66 U.S. securities other than U.S. Treasury securities................................... 196,908 28,297 -39,577 64,694 143,494 -10,970 -43,203 131,648 174,851 67 U.S. currency......................................................................... 57,141 18,057 7,116 16,156 15,812 4,957 9,486 12,664 3,178 68 U.S. liabilities to unaffiliated foreigners reported by U.S. nonbanking concerns...... -39,505 13,279 -25,581 -4,763 -22,440 -20,872 18,850 -60,786 -79,636 69 U.S. liabilities reported by U.S. banks and securities brokers........................ -387,378 -127,450 -220,672 15,412 -54,668 86,154 155,144 -111,477 -266,621 70 Financial derivatives, net.................................................................... -7,064 -7,339 2,419 -5,129 2,985 3,948 3,511 -6,569 -10,080 71 Statistical discrepancy (lines 1, 18, 35, 39, 40, 55, and 70 with sign reversed).............. -5,891 -142,718 92,741 78,825 -34,738 64,513 31,339 /2/27,550 /3/-3,789 Memoranda: 72 Balance on goods (lines 3 and 20)............................................................. -741,475 -193,604 -186,487 -178,980 -182,403 -179,457 -175,736 -178,630 -2,894 73 Balance on services (lines 4 and 21).......................................................... 206,819 50,657 51,186 49,952 55,025 56,824 57,614 57,892 278 74 Balance on goods and services (lines 2 and 19)................................................ -534,656 -142,947 -135,302 -129,029 -127,378 -122,633 -118,122 -120,738 -2,616 75 Balance on income (lines 12 and 29)........................................................... 223,928 54,876 57,457 54,630 56,965 50,881 55,997 59,998 4,001 76 Unilateral current transfers, net (line 35)................................................... -129,688 -32,771 -32,668 -32,343 -31,906 -33,143 -34,488 -34,100 388 77 Balance on current account (lines 1, 18, and 35 or lines 74, 75, and 76)...................... -440,416 -120,842 -110,513 -106,742 -102,320 -104,895 -96,613 -94,840 1,773 78 Net financial flows (lines 40, 55, and 70).................................................... 439,351 263,561 18,013 28,387 129,390 40,422 65,501 67,290 1,789 p Preliminary r Revised n.a. Not available 1 Credits, +: Exports of goods and services and income receipts; unilateral current transfers to the United States; capital account receipts; financial inflows—increase in foreign-owned assets (U.S. liabilities) or decrease in U.S.-owned assets (U.S. claims). Debits, -: Imports of goods and services and income payments; unilateral current transfers to foreigners; capital account payments; financial outflows-decrease in foreign-owned assets (U.S. liabilities) or increase in U.S.-owned assets (U.S. claims). 2 Calculated excluding capital account transactions, net (line 39). 3 The change shown here is calculated as the change from the prior period, not as the sum of changes in the above items. Note: Details may not add to totals because of rounding. Source: U. S. Bureau of Economic Analysis