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News Release: U.S. International Transactions

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FOR WIRE TRANSMISSION: 8:30 A.M. EST, WEDNESDAY, DECEMBER 16, 2009
BEA 09-54


Douglas B. Weinberg: (202) 606-9590 (Data)
U.S. International Transactions, 3rd 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—increased to $108.0
billion (preliminary) in the third quarter of 2009 from $98.0 billion (revised)
in the second quarter.  The increase was more than accounted for by an increase
in the deficit on goods.  A small increase in net unilateral current transfers to
foreigners also contributed to the higher current-account deficit.  Increases in
the surpluses on income and on services were partly offsetting.

Goods and services

        The deficit on goods and services increased to $97.4 billion in the third
quarter from $81.2 billion in the second.

        Goods
        The deficit on goods increased to $132.1 billion in the third
quarter from $115.5 billion in the second.

        Goods exports increased to $263.9 billion from $246.1 billion.  The
increase was largely accounted for by increases in industrial supplies and materials
and in automotive products.  Capital goods and consumer goods also increased.

        Goods imports increased to $396.1 billion from $361.6 billion.  The increase
was largely accounted for by increases in industrial supplies and materials, mostly
in petroleum and products, and in automotive products.  Capital goods and consumer
goods also increased.

        Services
        The surplus on services increased to $34.8 billion in the third quarter
from $34.2 billion in the second.

        Services exports increased to $128.6 billion from $125.3 billion.  The
increase was mostly accounted for by increases in travel, in “other” private
services (such as business, professional, and technical services, insurance services,
and financial services), in “other” transportation (such as freight and port services),
and in royalties and license fees.

        Services imports increased to $93.9 billion from $91.0 billion.  The increase
was mostly accounted for by increases in “other” private services, in travel, in
 “other” transportation, and in direct defense expenditures.

Income

        The surplus on income increased to $23.7 billion in the third quarter from
$16.7 billion in the second.

        Investment income   Income receipts on U.S.-owned assets abroad increased
to $139.7 billion from $134.3 billion.  An increase in direct investment receipts
was partly offset by decreases in “other” private receipts (which consists of
interest and dividends) and in U.S. government receipts.

        Income payments on foreign-owned assets in the United States decreased to
$114.2 billion from $115.9 billion.  Decreases in “other” private payments (which
consists of interest and dividends) and in U.S. government payments were largely
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 were virtually unchanged at $2.5 billion.

Unilateral current transfers

        Net unilateral current transfers to foreigners were $34.4 billion in the
third quarter, up from $33.4 billion in the second.  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 third quarter.

                           Financial Account

        Net financial inflows were $38.3 billion in the third quarter, down from
$63.3 billion in the second.  The slowdown resulted from a shift to an increase
from a decrease in U.S.-owned assets abroad (a shift to outflows from inflows)
that was mostly offset by a larger increase in foreign-owned assets in the United
States in the third quarter than in the second quarter (larger inflows).

U.S.-owned assets abroad

        U.S.-owned assets abroad increased $294.1 billion in the third quarter,
following a decrease of $37.4 billion in the second.

        U.S. claims on foreigners reported by U.S. banks and securities brokers
increased $240.1 billion in the third quarter, following an increase of $27.2
billion in the second.  (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 $47.8 billion in the third
quarter, down from $92.6 billion in the second.  Net U.S. purchases of foreign
stocks were $26.8 billion, down from $37.7 billion.  Net U.S. purchases of foreign
bonds were $21.0 billion, down from $54.9 billion.

        U.S. direct investment abroad increased $62.7 billion in the third quarter,
following an increase of $47.4 billion in the second.  Shifts to increases from
decreases in net equity capital investment and in net intercompany debt investment
abroad were partly offset by a small reduction in reinvested earnings.

        U.S. official reserve assets increased $49.0 billion in the third quarter,
following an increase of $3.6 billion in the second.  The pickup resulted from
the allocation of $47.6 billion in special drawing rights (SDRs) to the United
States as part of two new allocations of SDRs by the International Monetary Fund
to its member countries.

        U.S. government assets other than official reserve assets decreased $57.9
billion in the third quarter, following a decrease of $193.8 billion in the second.
The decreases in each of the last three quarters resulted from the reversal of
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 $332.4 billion in the
third quarter, following an increase of $14.6 billion in the second.

        U.S. liabilities to foreigners reported by U.S. banks and securities brokers
increased $127.0 billion in the third quarter, following a decrease of $178.9 billion
in the second.  (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.)

        Net sales of U.S. Treasury securities by private foreigners were $9.2
billion in the third quarter, down from $22.8 billion in the second.

        Net purchases of U.S. securities other than U.S. Treasury securities by
private foreigners were $24.7 billion in the third quarter, up from $13.9 billion
in the second.  Net foreign purchases of U.S. stocks were $48.6 billion, up from
$35.6 billion.  Net foreign purchases of U.S. federally sponsored agency bonds
were $6.6 billion, up from $0.3 billion.  Net foreign sales of U.S. corporate bonds
were $30.4 billion, up from $22.0 billion.

        Foreign direct investment in the United States increased $40.0 billion
in the third quarter, following an increase of $37.0 billion in the second.  The
pickup was more than accounted for by larger increases in reinvested earnings and,
to a much lesser extent, in net equity capital investment in the United States.
In contrast, net intercompany debt investment in the United States slowed.

        Foreign official assets in the United States increased $123.6 billion in
the third quarter, following an increase of $124.3 billion in the second.  The
third-quarter increase includes, as part of “other” U.S. government liabilities,
a $47.6 billion increase associated with the allocation of SDRs to the United States.

        Transactions in U.S. currency shifted to net shipments to foreign countries
of $4.2 billion in the third quarter from net shipments to the United States of
$1.9 billion in the second.

        The statistical discrepancy—errors and omissions in recorded
transactions—was $70.4 billion in the third quarter, compared with $35.4 billion
in the second.

        In the third quarter, the U.S. dollar depreciated 5 percent on a
trade-weighted quarterly average basis against a group of 7 major currencies.

                 Revisions in Selected Historical Statistics

In a departure from BEA’s normal schedule for revisions, selected historical
statistics for the international transactions accounts released today are revised
starting with the first quarter of 1970.  The revisions result from a change in
the way that BEA records allocations of special drawing rights (SDRs) to the
United States and are prompted by the need to record special SDR allocations made
by the International Monetary Fund (IMF) in the third quarter to help combat the
global financial crisis.  (SDRs are international reserve assets created by the
IMF and allocated to participating member countries.)  Consistent with new
international standards, allocations of SDRs to the United States are now recorded
as transactions in the financial account.  Such allocations were made in the first
quarters of 1970, 1971, 1972, 1979, 1980, and 1981 and in the third quarter of 2009.
Additional information is available in an FAQ on BEA’s Web site and
will also be available in the January Survey of Current Business article on U.S.
international transactions.

                                  Revisions

        The second-quarter international transactions are revised from previously
published statistics.  The current-account deficit was revised to $98.0 billion
from $98.8 billion.  The goods deficit was unrevised at $115.5 billion; the
services surplus was revised to $34.2 billion from $32.5 billion; the income
surplus was revised to $16.7 billion from $16.4 billion; and unilateral current
transfers were revised to net outflows of $33.4 billion from $32.2 billion.  Net
financial inflows were revised to $63.3 billion from $58.3 billion.

                            *          *          *

	Release dates in 2010:

        Fourth quarter and year 2009...................March 18, 2010 (Thursday)
        First quarter 2010..............................June 17, 2010 (Thursday)
        Second quarter 2010........................September 16, 2010 (Thursday)
        Third quarter 2010..........................December 16, 2010 (Thursday)

                            *          *          *

        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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