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News Release: U.S. International Transactions

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FOR WIRE TRANSMISSION: 8:30 A.M. EDT, WEDNESDAY, SEPTEMBER 16, 2009
BEA 09-40


Douglas B. Weinberg: (202) 606-9590 (Data)
U.S. International Transactions, 2nd Quarter 2009
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 $98.8
billion (preliminary) in the second quarter of 2009, the smallest deficit since
the fourth quarter of 2001, from $104.5 billion (revised) in the first quarter.
The decrease was more than accounted for by a decrease in the deficit on goods.
A small increase in the surplus on services also contributed to the lower
current-account deficit.  An increase in net unilateral current transfers to
foreigners and a decrease in the surplus on income were partly offsetting.

Goods and services

        The deficit on goods and services decreased to $83.0 billion in the second
quarter from $92.4 billion in the first.

        Goods
        The deficit on goods decreased to $115.5 billion in the second quarter
from $124.0 billion in the first.


        Goods exports decreased to $246.1 billion from $249.4 billion.  The
decrease was more than accounted for by a decrease in capital goods, reflecting
declines in most categories of capital goods.  Automotive products and consumer
goods also decreased.  These decreases were partly offset by increases in foods,
feeds, and beverages and in industrial supplies and materials.

        Goods imports decreased to $361.6 billion from $373.4 billion.  The
decrease was more than accounted for by a decrease in nonpetroleum products,
particularly in nonpetroleum industrial supplies and materials and in capital
goods.  Consumer goods and automotive products also decreased.  These decreases
were partly offset by an increase in petroleum and products.

        Services
        The surplus on services increased to $32.5 billion in the second quarter
from $31.6 billion in the first.

        Services exports decreased to $121.7 billion from $122.8 billion.  The
decrease was more than accounted for by decreases in travel, in passenger fares,
and in “other” transportation (such as freight and port services).  These decreases
were partly offset by increases in transfers under U.S. military agency sales
contracts and in “other” private services (such as business, professional, and
technical services, insurance services, and financial services).

        Services imports decreased to $89.2 billion from $91.2 billion.  The
decrease was more than accounted for by decreases in “other” transportation, in
travel, and in passenger fares.  These decreases were partly offset by increases
in “other” private services and in direct defense expenditures.

Income

        The surplus on income decreased to $16.4 billion in the second quarter
from $18.3 billion in the first.

        Investment income

        Income receipts on U.S.-owned assets abroad decreased to $132.3 billion
from $134.6 billion.  Decreases in “other” private receipts (which consists of
interest and dividends) and in U.S. government receipts were mostly offset by an
increase in direct investment receipts.

        Income payments on foreign-owned assets in the United States decreased to
$114.1 billion from $114.5 billion.  Decreases in “other” private payments (which
consists of interest and dividends) and in U.S. government payments were mostly
offset by an increase in direct investment payments.

        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 edged down to $2.5 billion from $2.6 billion.

Unilateral current transfers

        Net unilateral current transfers to foreigners were $32.2 billion in the
second quarter, up from $30.3 billion in the first.  The increase was more than
accounted for by an increase in U.S. government grants.

                              Capital Account

        Net capital account payments (outflows) were virtually unchanged at $0.7
billion in the second quarter.

                             Financial Account

        Net financial inflows were $58.3 billion in the second quarter, up from
$35.4 billion in the first.  The pickup resulted from a shift from financial
outflows to financial inflows for foreign-owned assets in the United States that
was only partly offset by a slowdown in financial inflows for U.S.-owned assets
abroad.

U.S.-owned assets abroad

        U.S.-owned assets abroad decreased $41.9 billion in the second quarter,
following a decrease of $94.7 billion in the first.

        U.S. claims on foreigners reported by U.S. banks and securities brokers
increased $34.4 billion in the second quarter, following an increase of $89.4
billion in the first.  (Examples of these claims are U.S. residents’ deposits at
banks abroad and loans by U.S. banks and securities brokers to foreigners.)

        Net U.S. purchases of foreign securities were $92.4 billion in the second
quarter, up from $36.2 billion in the first.  Net U.S. purchases of foreign stocks
were $37.2 billion, up from $1.8 billion.  Net U.S. purchases of foreign bonds
were $55.2 billion, up from $34.4 billion.

        U.S. direct investment abroad increased $44.9 billion in the second quarter,
following an increase of $40.3 billion in the first.  A pickup in reinvested
earnings was partly offset by a shift from an increase to a decrease in net equity
capital investment abroad and a larger decrease in net intercompany debt investment
abroad.

        U.S. official reserve assets increased $3.6 billion in the second quarter,
following an increase of $1.0 billion in the first.

        U.S. government assets other than official reserve assets decreased $193.9
billion in the second quarter, following a decrease of $244.1 billion in the first.
The decreases in both quarters resulted from the reversal of some of the swaps
initiated under temporary reciprocal currency arrangements between the U.S. Federal
Reserve System and foreign central banks.

Foreign-owned assets in the United States

        Foreign-owned assets in the United States increased $16.4 billion in the
second quarter, following a decrease of $67.8 billion in the first.

        U.S. liabilities to foreigners reported by U.S. banks and securities
brokers decreased $144.4 billion in the second quarter, following a decrease of
$163.8 billion in the first.  (Examples of these liabilities are deposits of
foreign residents at banks in the United States and loans by banks abroad to banks
and securities brokers in the United States.)

        Transactions in U.S. Treasury securities by private foreigners shifted
to net foreign sales of $22.7 billion in the second quarter from net foreign
purchases of $53.7 billion in the first.

        Transactions in U.S. securities other than U.S. Treasury securities by
private foreigners shifted to net foreign purchases of $14.2 billion in the
second quarter from net foreign sales of $56.0 billion in the first.  Transactions
in U.S. federally sponsored agency bonds shifted to net foreign purchases of $0.4
billion from net foreign sales of $49.7 billion.  Net foreign purchases of U.S.
stocks were $35.8 billion, up from $6.1 billion.  Net foreign sales of U.S.
corporate bonds were $22.0 billion, up from $12.4 billion.

        Foreign direct investment in the United States increased $26.1 billion
in the second quarter, following an increase of $23.9 billion in the first.  A
shift from negative to positive reinvested earnings was mostly offset by slowdowns
in net intercompany debt investment and net equity capital investment in the United
States.

        Foreign official assets in the United States increased $125.0 billion in
the second quarter, following an increase of $70.9 billion in the first.

        Transactions in U.S. currency shifted to net shipments to the United States
of $1.9 billion in the second quarter from net shipments to foreign countries of
$11.8 billion in the first.

        The statistical discrepancy—errors and omissions in recorded transactions—was
$41.2 billion in the second quarter, compared with $69.8 billion in the first.

        In the second quarter, the U.S. dollar depreciated 4 percent on a trade-
weighted quarterly average basis against a group of 7 major currencies.

                                  Revisions

        The first-quarter international transactions are revised from previously
published statistics.  The current-account deficit was revised to $104.5 billion
from $101.5 billion.  The goods deficit was unrevised at $124.0 billion; the
services surplus was revised to $31.6 billion from $32.8 billion; the income
surplus was revised to $18.3 billion from $19.3 billion; and unilateral current
transfers were revised to net outflows of $30.3 billion from $29.6 billion.  Net
financial inflows were revised to $35.4 billion from $47.1 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)

                            *          *          *

        Summary BEA statistics are available on recorded messages at the time of
public release at the following telephone numbers:

               (202) 606-5306 Gross domestic product
                        -5303 Personal income and outlays

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