U.S. International Transactions

Second Quarter 2021

By Rudy Telles  |  Volume 101, Number 10  |  October 20, 2021

Download PDF

The U.S. current-account deficit, which reflects the combined balances on trade in goods and services and income flows between U.S. residents and residents of other countries, widened by $0.9 billion, or 0.5 percent, to $190.3 billion in the second quarter of 2021 (chart 1 and table A). The revised first-quarter deficit was $189.4 billion.

The second-quarter deficit was 3.3 percent of current-dollar gross domestic product, down from 3.4 percent in the first quarter.

The $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.

Chart 1. U.S. Current-Account Balance and Its Components

[Click chart to expand]

Table A. U.S. International Transactions
[Millions of dollars, seasonally adjusted]
Series 2020 2021 Change 2021:Q1 to 2021:Q2
Q3 Q4 Q1 r Q2 p
Current account          
Exports of goods and services and income receipts (credits) 806,445 851,907 895,258 937,949 42,691
Exports of goods and services 523,259 558,795 589,805 625,667 35,862
Goods 356,826 384,050 408,344 436,607 28,263
Services 166,433 174,745 181,461 189,060 7,599
Primary income receipts 240,265 252,040 262,922 270,644 7,722
Secondary income (current transfer) receipts 42,921 41,072 42,531 41,638 −893
Imports of goods and services and income payments (debits) 978,807 1,026,986 1,084,681 1,128,231 43,550
Imports of goods and services 710,359 755,582 795,902 834,094 38,192
Goods 602,196 637,175 677,232 706,276 29,044
Services 108,163 118,406 118,670 127,818 9,148
Primary income payments 192,008 197,824 212,732 221,546 8,814
Secondary income (current transfer) payments 76,440 73,580 76,048 72,590 −3,458
Capital account          
Capital transfer receipts and other credits 348 9 23 5 −18
Capital transfer payments and other debits 898 1,133 2,765 870 −1,895
Financial account          
Net U.S. acquisition of financial assets excluding financial derivatives (net increase in assets / financial outflow (+)) 29,307 228,289 395,838 248,225 −147,613
Direct investment assets 122,349 96,702 76,945 139,660 62,715
Portfolio investment assets 121,217 53,940 294,204 134,819 −159,385
Other investment assets −216,078 75,209 26,788 −26,731 −53,519
Reserve assets 1,820 2,438 −2,100 477 2,577
Net U.S. incurrence of liabilities excluding financial derivatives (net increase in liabilities / financial inflow (+)) 201,141 502,122 574,400 526,954 −47,446
Direct investment liabilities 111,589 101,824 70,558 94,982 24,424
Portfolio investment liabilities 114,935 350,675 323,752 236,583 −87,169
Other investment liabilities −25,383 49,623 180,090 195,389 15,299
Financial derivatives other than reserves, net transactions 28,425 2,633 −2,216 −8,612 −6,396
Statistical discrepancy          
Statistical discrepancy1 29,504 −94,997 11,388 −96,194 −107,582
Balances          
Balance on current account −172,362 −175,079 −189,424 −190,282 −858
Balance on goods and services −187,101 −196,787 −206,097 −208,427 −2,330
Balance on goods −245,370 −253,125 −268,889 −269,669 −780
Balance on services 58,270 56,339 62,791 61,242 −1,549
Balance on primary income 48,257 54,216 50,190 49,098 −1,092
Balance on secondary income −33,519 −32,508 −33,516 −30,953 2,563
Balance on capital account −550 −1,124 −2,743 −865 1,878
Net lending (+) or net borrowing (−) from current- and capital-account transactions2 −172,912 −176,203 −192,166 −191,147 1,019
Net lending (+) or net borrowing (−) from financial-account transactions3 −143,408 −271,199 −180,778 −287,341 −106,563
p
Preliminary
r
Revised
  1. The statistical discrepancy is the difference between net acquisition of financial assets and net incurrence of liabilities in the financial account (including financial derivatives) less the difference between total credits and total debits recorded in the current and capital accounts.
  2. Sum of current- and capital-account balances.
  3. Sum of net U.S. acquisition of financial assets and net transactions in financial derivatives less net U.S. incurrence of liabilities.

Note. The statistics are presented in International Transactions Accounts table 1.2 on BEA's website.

 

Exports of goods and services to, and income received from, foreign residents increased $42.7 billion to $937.9 billion in the second quarter (charts 2 and 3 and tables A and B). Imports of goods and services from, and income paid to, foreign residents increased $43.6 billion, to $1.13 trillion (charts 2 and 4 and tables A and C).

Chart 2. Current-Account Transactions

[Click chart to expand]

Trade in goods

Exports of goods increased $28.3 billion to $436.6 billion, mostly reflecting increases in industrial supplies and materials, mainly petroleum and related products, and in capital goods, mainly civilian aircraft and semiconductors. Imports of goods increased $29.0 billion, to $706.3 billion, primarily reflecting an increase in industrial supplies and materials, mainly petroleum and related products and metals and nonmetallic products.

Trade in services

Exports of services increased $7.6 billion, to $189.1 billion, primarily reflecting an increase in travel, mostly other personal travel. Imports of services increased $9.1 billion, to $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 $7.7 billion, to $270.6 billion, and payments of primary income increased $8.8 billion, to $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 $0.9 billion, to $41.6 billion, mainly reflecting a decrease in general government transfers, mostly public sector fines and penalties. Payments of secondary income decreased $3.5 billion, to $72.6 billion, mainly reflecting a decrease in general government transfers, mostly international cooperation.

Chart 3. Percent Change in Exports of Goods and Services and Income Receipts

[Click chart to expand]

Chart 4. Percent Change in Imports of Goods and Services and Income Payments

[Click chart to expand]

Table B. Exports of Goods and Services and Income Receipts
[Millions of dollars, seasonally adjusted]
Series 2020 2021 Change 2021:Q1 to
2021:Q2
Q3 Q4 Q1 r Q2 p
Exports of goods and services and income receipts 806,445 851,907 895,258 937,949 42,691
Exports of goods 356,826 384,050 408,344 436,607 28,263
General merchandise 349,705 376,467 398,257 428,356 30,099
Foods, feeds, and beverages 34,741 38,922 40,667 40,445 −222
Industrial supplies and materials 108,713 119,483 134,595 152,662 18,067
Energy products 39,385 42,678 52,074 63,373 11,299
Of which: Petroleum and products 32,819 33,665 39,992 51,510 11,518
Nonenergy products 69,328 76,805 82,521 89,289 6,768
Capital goods except automotive 112,003 117,444 122,323 131,809 9,486
Automotive vehicles, parts, and engines 36,438 38,372 37,395 34,856 −2,539
Consumer goods except food and automotive 44,822 48,781 48,256 52,847 4,591
Other general merchandise 12,987 13,464 15,021 15,737 716
Net exports of goods under merchanting 252 276 253 258 5
Nonmonetary gold 6,869 7,307 9,833 7,993 −1,840
Exports of services1 166,433 174,745 181,461 189,060 7,599
Manufacturing services on physical inputs owned by others n.a. n.a. n.a. n.a. n.a.
Maintenance and repair services n.i.e. 2,833 2,820 2,946 2,987 41
Transport 12,191 13,301 14,338 15,354 1,016
Travel (for all purposes including education) 10,527 11,967 13,258 16,153 2,895
Business 1,854 2,229 2,459 2,921 462
Personal 8,673 9,738 10,800 13,233 2,433
Construction 596 505 651 703 52
Insurance services 5,353 5,281 5,291 5,478 187
Financial services 36,004 37,944 39,420 40,481 1,061
Charges for the use of intellectual property n.i.e. 28,757 30,343 30,092 31,157 1,065
Telecommunications, computer, and information services 13,501 15,505 14,701 14,042 −659
Other business services 45,402 45,869 49,436 50,569 1,133
Personal, cultural, and recreational services 5,740 5,777 5,483 6,336 853
Government goods and services n.i.e. 5,528 5,433 5,842 5,800 −42
Primary income receipts 240,265 252,040 262,922 270,644 7,722
Investment income 238,676 250,444 261,280 268,975 7,695
Direct investment income 132,107 141,436 150,871 155,302 4,431
Income on equity 127,692 137,130 146,940 151,463 4,523
Dividends and withdrawals 58,041 50,926 84,037 58,138 −25,899
Reinvested earnings 69,651 86,204 62,903 93,325 30,422
Interest 4,415 4,306 3,931 3,839 −92
Portfolio investment income 91,205 94,038 95,851 97,989 2,138
Income on equity and investment fund shares 59,988 62,513 62,311 64,636 2,325
Interest on debt securities 31,217 31,525 33,540 33,353 −187
Other investment income 15,321 14,974 14,493 15,637 1,144
Reserve asset income 44 −3 65 47 −18
Compensation of employees 1,588 1,596 1,642 1,669 27
Secondary income (current transfer) receipts2 42,921 41,072 42,531 41,638 −893
p
Preliminary
r
Revised
n.a.
Not available
n.i.e.
Not included elsewhere
  1. See also International Services table 2.1.
  2. Secondary income (current transfer) receipts include U.S. government and private transfers, such as fines and penalties, withholding taxes, insurance-related transfers, and other current transfers.

Note. The statistics are presented in International Transactions Accounts table 1.2, table 2.1, table 3.1, table 4.1, and table 5.1 on BEA's website.

Table C. Imports of Goods and Services and Income Payments
[Millions of dollars, seasonally adjusted]
Series 2020 2021 Change 2021:Q1 to 2021:Q2
Q3 Q4 Q1 r Q2 p
Imports of goods and services and income payments 978,807 1,026,986 1,084,681 1,128,231 43,550
Imports of goods 602,196 637,175 677,232 706,276 29,044
General merchandise 587,803 629,137 670,355 699,708 29,353
Foods, feeds, and beverages 39,734 40,104 41,284 46,263 4,979
Industrial supplies and materials 103,738 114,295 136,280 156,815 20,535
Energy products 31,305 34,917 46,785 56,519 9,734
Of which: Petroleum and products 28,333 31,241 42,689 52,205 9,516
Nonenergy products 72,433 79,378 89,495 100,296 10,801
Capital goods except automotive 165,285 173,646 183,798 190,577 6,779
Automotive vehicles, parts, and engines 85,142 96,590 90,642 87,214 −3,428
Consumer goods except food and automotive 167,608 177,787 190,923 190,302 −621
Other general merchandise 26,297 26,716 27,428 28,538 1,110
Nonmonetary gold 14,393 8,038 6,877 6,568 −309
Imports of services1 108,163 118,406 118,670 127,818 9,148
Manufacturing services on physical inputs owned by others n.a. n.a. n.a. n.a. n.a.
Maintenance and repair services n.i.e. 1,508 1,562 1,945 2,021 76
Transport 16,227 18,728 19,875 24,390 4,515
Travel (for all purposes including education) 3,687 7,559 7,891 11,826 3,935
Business 568 1,172 1,132 1,812 680
Personal 3,118 6,387 6,760 10,015 3,255
Construction 227 312 334 320 −14
Insurance services 14,381 14,399 14,059 14,414 355
Financial services 10,204 10,869 10,497 10,751 254
Charges for the use of intellectual property n.i.e. 11,165 11,959 11,783 11,251 −532
Telecommunications, computer, and information services 9,263 10,156 9,971 9,827 −144
Other business services 29,342 30,598 29,674 30,486 812
Personal, cultural, and recreational services 6,027 6,067 6,416 6,210 −206
Government goods and services n.i.e. 6,132 6,197 6,226 6,321 95
Primary income payments 192,008 197,824 212,732 221,546 8,814
Investment income 188,552 194,211 208,898 217,730 8,832
Direct investment income 50,147 53,342 64,108 73,158 9,050
Portfolio investment income 119,840 122,822 127,727 126,118 −1,609
Income on equity and investment fund shares 41,795 44,659 46,463 45,379 −1,084
Interest on debt securities 78,045 78,163 81,264 80,739 −525
Other investment income 18,566 18,048 17,063 18,453 1,390
Compensation of employees 3,456 3,613 3,834 3,817 −17
Secondary income (current transfer) payments2 76,440 73,580 76,048 72,590 −3,458
           
Supplemental detail on insurance transactions:          
Premiums paid 37,034 36,435 36,533 37,399 866
Losses recovered 25,481 25,145 25,266 25,509 243
p
Preliminary
r
Revised
n.a.
Not available
n.i.e.
Not included elsewhere
  1. See also International Services table 2.1
  2. Secondary income (current transfer) payments include U.S. government and private transfers, such as U.S. government grants and pensions, fines and penalties, withholding taxes, personal transfers (remittances), insurance-related transfers, and other current transfers.

Note. The statistics are presented in International Transactions Accounts table 1.2, table 2.1, table 3.1, table 4.1, and table 5.1 on BEA's website.

Capital-transfer payments decreased $1.9 billion, to $0.9 billion, in the second quarter, mostly reflecting a decrease in investment grants (table A).

 

 

Net financial-account transactions were −$287.3 billion in the second quarter, reflecting net U.S. borrowing from foreign residents.

Financial assets

Second-quarter transactions increased U.S. residents' foreign financial assets by $248.2 billion (charts 5 and 6 and table D). Transactions increased direct investment assets, primarily equity, by $139.7 billion; portfolio investment assets, primarily equity securities, by $134.8 billion; and reserve assets by $0.5 billion. Transactions decreased other investment assets by $26.7 billion, driven by deposits.

Liabilities

Second-quarter transactions increased U.S. liabilities to foreign residents by $527.0 billion. Transactions increased portfolio investment liabilities, primarily long-term debt securities, by $236.6 billion; other investment liabilities, mostly loans and deposits, by $195.4 billion; and direct investment liabilities, mostly equity, by $95.0 billion.

Financial derivatives

Net transactions in financial derivatives were −$8.6 billion in the second quarter, reflecting net U.S. borrowing from foreign residents.

Chart 5. Acquisition of Financial Assets and Incurrence of Liabilities Excluding Financial Derivatives

[Click chart to expand]

Chart 6. Transactions in Financial Assets and Liabilities Excluding Financial Derivatives

[Click chart to expand]

Table D. Net U.S. Acquisition of Financial Assets and Net U.S. Incurrence of Liabilities
[Millions of dollars, seasonally adjusted]
Series 2020 2021 Change 2021:Q1 to 2021:Q2
Q3 Q4 Q1 r Q2 p
Net U.S. acquisition of financial assets excluding financial derivatives (net increase in assets / financial outflow (+)) 29,307 228,289 395,838 248,225 −147,613
Direct investment assets 122,349 96,702 76,945 139,660 62,715
Equity 79,749 86,913 76,921 124,077 47,156
Equity other than reinvestment of earnings 10,098 709 14,019 30,752 16,733
Reinvestment of earnings 69,651 86,204 62,903 93,325 30,422
Debt instruments 42,600 9,789 24 15,583 15,559
Portfolio investment assets 121,217 53,940 294,204 134,819 −159,385
Equity and investment fund shares 88,690 −42,526 83,024 116,623 33,599
Debt securities 32,527 96,466 211,180 18,196 −192,984
Short-term securities 19,457 29,440 39,856 19,530 −20,326
Long-term corporate securities 10,094 50,875 123,792 −2,414 −126,206
Other long-term securities 2,976 16,151 47,532 1,080 −46,452
Other investment assets −216,078 75,209 26,788 −26,731 −53,519
Other equity 215 324 1,169 0 −1,169
Currency and deposits −130,385 −6,533 −1,588 −77,345 −75,757
Loans −84,148 77,929 23,323 53,569 30,246
Trade credit and advances −1,761 3,489 3,884 −2,955 −6,839
Reserve assets 1,820 2,438 −2,100 477 2,577
Monetary gold 0 0 0 0 0
Special drawing rights 5 7 8 4 −4
Reserve position in the International Monetary Fund 1,785 2,454 −2,157 437 2,594
Other reserve assets 29 −23 50 36 −14
Net U.S. incurrence of liabilities excluding financial derivatives (net increase in liabilities / financial inflow (+)) 201,141 502,122 574,400 526,954 −47,446
Direct investment liabilities 111,589 101,824 70,558 94,982 24,424
Equity 42,809 82,922 72,192 84,922 12,730
Equity other than reinvestment of earnings 13,307 51,302 30,740 36,126 5,386
Reinvestment of earnings 29,502 31,620 41,453 48,797 7,344
Debt instruments 68,780 18,902 −1,635 10,060 11,695
Portfolio investment liabilities 114,935 350,675 323,752 236,583 −87,169
Equity and investment fund shares 117,901 246,335 96,969 −15,709 −112,678
Debt securities −2,966 104,340 226,783 252,292 25,509
Short term −38,910 1,406 −44,402 −27,750 16,652
Treasury bills and certificates −23,352 10,017 −60,815 −41,245 19,570
Federally sponsored agency securities −3,444 −1,778 −3,419 −1,352 2,067
Other short-term securities −12,114 −6,833 19,832 14,847 −4,985
Long term 35,944 102,935 271,186 280,042 8,856
Treasury bonds and notes 63,639 50,485 223,025 158,132 −64,893
Federally sponsored agency securities −51,228 11,801 −24,416 −13,697 10,719
Corporate bonds and notes 21,323 40,629 70,063 129,676 59,613
Other 2,210 20 2,514 5,931 3,417
Other investment liabilities −25,383 49,623 180,090 195,389 15,299
Other equity n.a. n.a. n.a. n.a. n.a
Currency 36,861 29,051 10,092 12,650 2,558
Deposits −40,913 33,304 83,801 52,444 −31,357
Loans −22,984 −18,784 81,318 127,280 45,962
Trade credit and advances 1,653 6,052 4,878 3,014 −1,864
Special drawing rights allocations 0 0 0 0 0
p
Preliminary
r
Revised

Note. The statistics are presented in International Transactions Accounts table 1.2, table 6.1, table 7.1, and table 8.1 on BEA's website.

The U.S. international transactions statistics for the first quarter have been updated to incorporate newly available and revised source data (table E).

Table E. Updates to the First-Quarter 2021 International Transactions Aggregates
[Millions of dollars, seasonally adjusted]
Series Preliminary Estimates Revised Estimates
Balance on current account −195,739 −189,424
Balance on goods −268,457 −268,889
Balance on services 55,699 62,791
Balance on primary income 50,284 50,190
Balance on secondary income (current transfers) −33,264 −33,516
Net lending or borrowing from financial-account transactions −175,226 −180,778
Net U.S. acquisition of financial assets 382,022 395,838
Net U.S. incurrence of liabilities 554,904 574,400
Financial derivatives other than reserves, net transactions −2,344 −2,216