The U.S. monthly international trade deficit decreased in July 2014 according to the U.S. Bureau of Economic Analysis and the U.S. Census Bureau. The deficit decreased from $40.8 billion in June (revised) to $40.5 billion in July as exports increased more than imports. The previously published June deficit was $41.5 billion. The goods deficit decreased $0.2 billion from June to $60.2 billion in July; the services surplus was nearly unchanged from June at $19.6 billion.
Exports of goods and services increased $1.8 billion in July to $198.0 billion, mostly reflecting an increase in exports of goods. Exports of services also increased.
- The increase in exports of goods was more than accounted for by increases in automotive vehicles, parts, and engines and in industrial supplies and materials. Partly offsetting were decreases in consumer goods and in foods, feeds, and beverages.
- The increase in exports of services reflected increases of less than $0.1 billion in several categories of services.
Imports of goods and services increased $1.6 billion in July to $238.6 billion, reflecting an increase in imports of goods. Imports of services were nearly unchanged.
- The increase in imports of goods was mostly accounted for by an increase in automotive vehicles, parts, and engines.
- Imports of services were nearly unchanged as an increase in other business services was mostly offset by a decrease in charges for the use of intellectual property, which decreased due to higher payments in June than in July for the rights to broadcast the 2014 soccer World Cup.
Goods by geographic area (seasonally adjusted, Census basis)
- The goods deficit with the European Union decreased from $11.5 billion in June to $9.5 billion in July. Exports increased $0.5 billion to $24.8 billion, and imports decreased $1.5 billion to $34.3 billion.
- The goods deficit with China decreased from $29.2 billion in June to $27.5 billion in July. Exports increased $0.1 billion to $9.8 billion, and imports decreased $1.6 billion to $37.3 billion.
- The goods deficit with OPEC increased from $3.6 billion in June to $4.9 billion in July. Exports increased $0.3 billion to $6.9 billion, and imports increased $1.5 billion to $11.8 billion.
See the full report.
The U.S. financial account is a key component of the Bureau of Economic Analysis’ international transactions accounts (ITAs). The financial account presents the cross-border flows of funds generated by international financial activity. Cross-border flows of funds can be large and volatile because the financial markets are large and because the flows are influenced by changing financial market conditions as well as by changes in financial regulation. The volatile nature of financial flows, particularly on a quarterly basis, can be seen in the accompanying chart.
The financial account records transactions in financial assets such as loans, financial derivatives, and securities between the United States and the rest of the world. For example, if a U.S. company acquires a British company, the increase in U.S. equity investment abroad is recorded as a financial outflow. If a resident of France deposits funds in a U.S. bank by transferring funds on deposit in a French bank, the deposit in the U.S. bank is recorded as a financial inflow.
As the world’s largest economy and a major center of global financial activity, the United States is an attractive market for foreigners looking to acquire new assets. In recent years, transactions in foreign-owned assets in the United States have resulted in more financial inflows to the United States than financial outflows from transactions in U.S.-owned assets abroad. In 2011, financial inflows to the United States were more than $1 trillion while financial outflows were less than half of that, $483.7 billion, for net financial inflows of $556.3 billion.
When financial transactions are combined with current account transactions in goods, services, income, and unilateral transfers, the combination presents a nearly complete picture of all international transactions of the United States. The financial account and the current account are the major components of the ITAs. The ITAs are used to monitor both real and financial developments in the international sector of the U.S. economy.
You can read more detailed information about the financial account here.
The U.S. current-account deficit—the combined balances on trade in goods and services, income, and net unilateral current transfers—increased to $137.3 billion (preliminary) in the first quarter of 2012 from $118.7 billion (revised) in the fourth quarter of 2011. As a percentage of U.S. gross domestic product, the deficit increased to 3.6 percent from 3.1 percent. The previously published current-account deficit for the fourth quarter was $124.1 billion.
The deficit on international trade in goods increased to $194.5 billion from $189.3 billion, as goods imports increased more than goods exports.
The surplus on international trade in services increased to $43.5 billion from $43.0 billion, as services receipts increased more than services payments.
The surplus on income decreased to $47.6 billion from $59.9 billion, as income payments increased while income receipts decreased.
Net unilateral current transfers to foreign residents were $33.9 billion, up from $32.2 billion.
Net financial inflows were $156.7 billion in the first quarter, up from $63.4 billion in the fourth.
U.S.-owned assets abroad decreased $114.8 billion in the first quarter after increasing $26.2 billion in the fourth.
Foreign-owned assets in the United States increased $41.9 billion in the first quarter after increasing $57.1 billion in the fourth.
To find out more about U.S. international transactions, read the full report.