Haver Analytics
Haver Analytics
USA
| Jun 20 2024

U.S. Current Account Deficit Unexpectedly Deepens in Q1

Summary
  • Deficit on goods increases while the services surplus surges.
  • Primary income surplus continues to shrink.
  • Net direct & portfolio investment grow.

The U.S. current account deficit increased in the first quarter of 2024 to $237.6 billion from $221.8 billion in Q4’23, revised from $194.8 billion, and $220.7 billion in Q3, revised from $196.4 billion. The Q1 deficit represented 3.4% of GDP, the most since Q2’23. The Action Economics Forecast Survey expected the Q1 deficit to narrow to $206.8 billion.

The increase in the current account deficit in Q1 was due to a rise in the deficit on goods to $277.7 billion from $264.6 billion in Q4. Exports of goods rose 0.4% (-0.4% y/y) after a 0.4% decline while imports of goods rose 2.0% (1.1% y/y) following a 0.6% rise. The services surplus increased to $73.2 from a surplus of $70.6 billion in Q4. Services exports rose 2.9% (8.7% y/y) after a 2.0% Q4 increase while imports of services rose 2.6% (7.9% y/y) following a 3.2% rise.

Among the income accounts, the surplus in primary income declined to $12.3 billion from $15.5 billion in Q4’23. Primary income includes investment income and compensation of employees. Primary income receipts rose 2.7% after a 0.1% slip while primary income payments rose 3.8% following a 0.3% rise. Secondary income includes transfer payments by governments, tax withholdings and insurance payments, among other items. In Q1, the deficit on secondary income increased to $45.5 billion from a deficit of -$43.3 billion in Q4.

Among capital account transactions, net U.S. acquisition of financial assets increased in Q1 to $321.2 billion from $299.8 billion in Q4. The Q1 amount included a net of $118.3 billion in direct investment assets and $164.1 billion in portfolio investment.

Balance of Payments data are in Haver’s USINT database, with summaries available in USECON. The expectations figure is in the AS1REPNA database.

  • Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio.   Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984.   He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C.   In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists.   Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.

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