Second quarter deficit amounted to 3.3% of current dollar gross domestic product

America’s current account deficit has increased by US$0.9 billion or 0.5 per cent to reach US$190.3 billion during the second quarter of 2021.  

This reflects the combined balances on trade in goods and services and income flows between US residents and residents of other countries. The revised first quarter deficit was US$189.4 billion.

The US Bureau of Economic Analysis (BEA) reports that the second quarter deficit amounted to 3.3 per cent of current dollar gross domestic product, down from 3.4 per cent in the first quarter. According to statistics from the BEA, “the US$0.9 billion widening of the current account deficit in the second quarter mainly reflected reduced surpluses on services and on primary income that were mostly offset by a reduced deficit on secondary income”.

Furthermore, in the second quarter, the export of goods and services and income received from foreign residents increased by US$42.7 billion to US$937.9 billion. The income received from foreign residents went up to US$688.0 billion.

However, imports of goods and services and income paid to foreign residents rose by US$43.6 billion to US$1.13 trillion.

Exports of Goods and Services

Exports of goods increased US$28.3 billion to US$436.6 billion, mostly reflecting increases in industrial supplies and materials. This is mainly petroleum and products, and in capital goods, mainly civilian aircraft and semiconductors. 

Imports of goods increased US$29.0 billion to US$706.3 billion, primarily reflecting an increase in industrial supplies and materials, mainly petroleum and products and metals and nonmetallic products. Exports of services increased US$7.6 billion to US$189.1 billion, primarily reflecting an increase in travel, mostly other personal travel. 

Imports of services increased US$9.1 billion to US$127.8 billion, mostly reflecting increases in transport, primarily sea freight and air passenger transport and in travel, primarily other personal travel.

Primary Income

Receipts of primary income increased US$7.7 billion to US$270.6 billion and payments of primary income increased US$8.8 billion to US$221.5 billion. The increases in both receipts and payments mainly reflected increases in direct investment income, primarily earnings.

Secondary Income

Receipts of secondary income decreased US$0.9 billion to US$41.6 billion, mainly reflecting a decrease in general government transfers, mostly public sector fines and penalties. Payments of secondary income decreased US$3.5 billion to US$72.6 billion, mainly reflecting a decrease in general government transfers, mostly international cooperation.

The BEA reports that, ”nearly all major categories of current account transactions increased in the second quarter of 2021, the fourth consecutive quarter of broad-based growth following notable COVID-19-related declines in the second quarter of 2020. The full economic effects of the COVID-19 pandemic cannot be quantified in the statistics because the impacts are generally embedded in source data and cannot be separately identified”.