News Release: U.S. International Transactions

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FOR WIRE TRANSMISSION: 8:30 A.M. EDT, THURSDAY, SEPTEMBER 19, 2013
BEA 13-43


Sarah P. Scott: (202) 606-9286 (Data)
U.S. International Transactions: Second 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 $98.9 billion (preliminary) in the
second quarter from $104.9 billion (revised) in the first quarter. The decrease in the current-
account deficit was accounted for by a decrease in the deficit on goods, an increase in the
surplus on income, and an increase in the surplus on services. These changes were partly offset
by an increase in net outflows of unilateral current transfers, such as government grants,
government pensions and other transfers, and private remittances.

Goods and services

      The deficit on goods and services decreased to $117.8 billion in the second quarter
from $122.6 billion in the first.

      Goods

      The deficit on goods decreased to $175.7 billion in the second quarter from $179.5 billion
in the first.

      Goods exports increased to $394.7 billion from $390.7 billion. Exports in four of the
six major end-use categories increased. The largest increases were in capital goods and in
consumer goods. The increase in capital goods was largely due to an increase in civilian
aircraft, engines, and parts. The largest decrease was in foods, feeds, and beverages and was
mostly due to a decrease in soybeans (Table 2a).

      Goods imports increased to $570.4 billion from $570.2 billion. Increases in five of the
six major end-use categories were nearly offset by a substantial decrease in industrial
supplies and materials. The largest increase was in automotive vehicles, parts, and engines,
much of that in passenger cars. The decrease in industrial supplies and materials was mostly
due to a decrease in petroleum and products (Table 2a).

      Services

      The surplus on services increased to $57.9 billion in the second quarter from $56.8
billion in the first.

      Services exports increased to $169.2 billion from $167.2 billion. Exports increased in
five of the seven major services categories. More than half the increase was in other private
services, primarily in financial services and in business, professional, and technical
services (Table 3a).

      Services imports increased to $111.3 billion from $110.4 billion. Imports increased in
six of the seven major services categories. The largest increases were in travel and in other
transportation (Table 3a).

Income

      The surplus on income increased to $53.1 billion in the second quarter from $50.9
billion in the first.

      Investment income

      Income receipts on U.S.-owned assets abroad increased to $190.8 billion from $190.0
billion. The increase was more than accounted for by an increase in other private receipts,
which consists of interest and dividends. Direct investment receipts and U.S. government
receipts decreased (Table 4).

      Income payments on foreign-owned assets in the United States decreased to $135.6 billion
from $137.1 billion. The decrease was more than accounted for by decreases in direct
investment payments and in U.S. government payments. Other private payments increased (Table 4).

      Compensation of employees

      Receipts for compensation of U.S. residents paid by nonresidents were $1.7 billion in
the second quarter, up from $1.6 billion in the first. Payments for compensation of foreign
residents paid by U.S. residents were $3.8 billion in the second quarter, up from $3.7 billion
in the first.

Unilateral current transfers

      Net unilateral current transfers to foreigners were $34.2 billion in the second quarter,
up from $33.1 billion in the first. The increase was mostly due to an increase in net outflows
of U.S. government pensions and other transfers that resulted from a decrease in fines and
penalties received by the U.S. government from foreign corporations. U.S. government grants to
foreigners also increased.

                                       Capital Account

      Net capital-account transactions are not available for the second quarter because
source data are not yet available. In the first quarter, net payments were less than $0.1
billion.

                                      Financial Account

      Net financial inflows were $73.1 billion in the second quarter, up from $40.4 billion in
the first. U.S.-owned assets abroad and foreign-owned assets in the United States both
increased less than in the first quarter, and outflows of U.S.-owned assets abroad were down
more relative to the first quarter than were inflows of foreign-owned assets in the United
States. Net inflows of financial derivatives decreased in the second quarter.

U.S.-owned assets abroad

      U.S.-owned assets abroad increased $109.6 billion in the second quarter after increasing
$229.1 billion in the first.

      U.S. official reserve assets decreased $0.2 billion in the second quarter after
increasing $0.9 billion in the first. The second-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 $3.9 billion in the
second quarter after increasing $0.4 billion in the first. The decrease reflected a reduction
of central bank liquidity swaps between the U.S. Federal Reserve System and foreign central
banks.

      U.S. direct investment abroad was $95.5 billion in the second quarter, up from $84.1
billion in the first. The increase was more than accounted for by a shift in equity investment
to net outflows in the second quarter from net inflows in the first quarter (Table 7a).

      U.S. purchases of foreign securities exceeded sales (net purchases) by $80.1 billion in
the second quarter, down from net purchases of $133.8 billion in the first. Net purchases of
foreign bonds were $3.8 billion, down from net purchases of $60.0 billion in the first. Net
purchases of foreign stocks were $76.3 billion, up from net purchases of $73.8 billion in the
first (Table 8a).

      U.S. claims on unaffiliated foreigners reported by U.S. nonbanking concerns increased
$67.1 billion in the second quarter after increasing $22.4 billion in the first. An example of
these claims is deposits of U.S. nonbanks at foreign banks.

      U.S. claims on foreigners reported by U.S. banks and securities brokers decreased $129.0
billion in the second quarter after decreasing $12.6 billion in the first. Examples of these
claims are deposits of U.S. banks at foreign banks and loans by U.S. banks to foreigners.

Foreign-owned assets in the United States

      Foreign-owned assets in the United States increased $179.3 billion in the second quarter
after increasing $265.5 billion in the first.

      Foreign official assets in the United States decreased $9.7 billion in the second
quarter after increasing $126.9 billion in the first. The second-quarter decrease was more
than accounted for by net sales of U.S. government securities.

      Foreign direct investment in the United States was $37.9 billion in the second quarter,
up from $28.6 billion in the first. The increase was accounted for by lower net outflows of
intercompany debt investment and by larger reinvested earnings than in the first quarter
(Table 7a).

      Foreign private sales of U.S. Treasury securities exceeded purchases (net sales) by $0.3
billion in the second quarter, a shift from net purchases of $50.8 billion in the first
quarter. The shift to net sales reflected a shift to net sales of U.S. Treasury bills and
certificates and a decrease in net purchases of U.S. Treasury bonds and notes
(Table 8a and Table 11a).

      Foreign private sales of U.S. securities other than U.S. Treasury securities exceeded
purchases (net sales) by $30.0 billion in the second quarter, up from net sales of $11.0
billion in the first. Net purchases of U.S. corporate bonds were $19.8 billion, down from
$32.3 billion. Net sales of U.S. stocks were $29.7 billion, up from $23.4 billion. Net sales
of U.S. federally sponsored agency bonds were $20.1 billion, up from $19.8 billion (Table 8a).

      Net shipments of U.S. currency to foreign countries were $9.5 billion in the second
quarter following net shipments of $5.0 billion in the first.

      U.S. liabilities to unaffiliated foreigners reported by U.S. nonbanking concerns
increased $18.7 billion in the second quarter after decreasing $20.9 billion in the first. An
example of these liabilities is loans by foreign banks to U.S. nonbanks.

      U.S. liabilities to foreigners reported by U.S. banks and securities brokers, other than
those recorded under foreign official assets, increased $153.2 billion in the second quarter
after increasing $86.2 billion in the first. Examples of these liabilities are deposits of
foreign residents at U.S. banks and loans by foreign banks to U.S. banks.

Financial Derivatives

      Net inflows of financial derivatives were $3.5 billion in the second quarter after net
inflows of $3.9 billion in the first.

                                   *          *          *

      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 $25.8 billion in
the second quarter compared with $64.5 billion in the first.

      In the second quarter, the U.S. dollar appreciated 2.2 percent on a trade-weighted
quarterly average basis against a group of 7 major currencies, the same percent increase as in
the first quarter. Exchange rate data are based on Federal Reserve Statistical Release H.10.

                                          Revisions

      The first-quarter 2013 international transactions are revised from previously published
statistics. The current-account deficit was revised down to $104.9 billion from $106.1
billion. The goods deficit was revised up to $179.5 billion from $179.1 billion; the services
surplus was revised up to $56.8 billion from $55.5 billion; the income surplus was revised
down to $50.9 billion from $52.0 billion; and net outflows of unilateral current transfers
were revised down to $33.1 billion from $34.5 billion. Net financial inflows were revised down
to $40.4 billion from $80.7 billion, reflecting a downward revision to inflows of foreign-
owned assets in the United States and an upward revision to outflows of U.S.-owned assets
abroad.

                                   *          *          *

      Release dates in 2013:

      Fourth Quarter and Year 2012...................................March 14, 2013 (Thursday)
      First Quarter 2013 and Annual Revisions...........................June 14, 2013 (Friday)
      Second Quarter 2013........................................September 19, 2013 (Thursday)
      Third Quarter 2013...........................................December 17, 2013 (Tuesday)

                                   *          *          *

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BUSINESS; and BEA news releases are available without charge on BEA’s Web site at www.bea.gov.
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NOTE: This news release is available on BEA’s Web site along with Highlights related to this 
release, the latest detailed statistics for U.S. international transactions, and a description 
of the estimation methods used to compile them. The second-quarter statistics in this release 
are preliminary and will be revised on December 17, 2013.  All links in the text of this 
release—including archived versions of this release—refer to the latest available statistics.