News Release: U.S. International Transactions

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FOR WIRE TRANSMISSION: 8:30 A.M. EST, TUESDAY, DECEMBER 17, 2013
BEA 13-60


Sarah P. Scott: (202) 606-9286  
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).

      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).

      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).

      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).

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).

      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).

      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).

      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).

      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).

      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).

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).

      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 and
(table 11a).

      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).

      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).

      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).

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)

                                   *          *          *
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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 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.