A Look at the U.S. International Transactions

Third Quarter of 2022

By Mai-Chi Hoang  |  January 17, 2023

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, narrowed by $21.6 billion, or 9.1 percent, to $217.1 billion in the third quarter of 2022. The revised second-quarter deficit was $238.7 billion.

The third-quarter deficit was 3.4 percent of current-dollar gross domestic product, down from 3.8 percent in the second quarter.

The $21.6 billion narrowing of the current-account deficit in the third quarter mostly reflected a decreased deficit on goods that was partly offset by a decreased surplus on primary income and an increased deficit on secondary income.

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

[View larger chart]
Table A. U.S. International Transactions
[Millions of dollars, seasonally adjusted]
Series 2021 2022 Change 2022:Q2 to 2022:Q3
Q4 Q1 Q2r Q3p
Current account          
Exports of goods and services and income receipts (credits) 1,001,171 1,025,046 1,111,290 1,137,754 26,464
Exports of goods and services 686,479 704,728 768,969 781,062 12,093
Goods 473,521 487,899 539,793 547,019 7,226
Services 212,959 216,829 229,176 234,043 4,867
Primary income receipts 271,520 278,059 298,761 313,971 15,210
Secondary income (current transfer) receipts 43,173 42,259 43,561 42,721 −840
Imports of goods and services and income payments (debits) 1,226,009 1,307,586 1,350,017 1,354,860 4,843
Imports of goods and services 911,479 987,479 1,022,572 991,660 −30,912
Goods 758,540 829,575 850,668 818,159 −32,509
Services 152,939 157,904 171,904 173,502 1,598
Primary income payments 234,527 239,239 241,547 268,350 26,803
Secondary income (current transfer) payments 80,003 80,867 85,898 94,850 8,952
Capital account          
Capital transfer receipts and other credits 13 28 6 9,078 9,072
Capital transfer payments and other debits 1,857 1,916 3,821 3,880 59
Financial account          
Net U.S. acquisition of financial assets excluding financial derivatives (net increase in assets / financial outflow (+)) 49,404 414,584 409,870 410,967 1,097
Direct investment assets 64,912 134,008 99,641 56,720 −42,921
Portfolio investment assets −106,715 227,966 276,714 368,923 92,209
Other investment assets 88,194 51,678 32,334 −15,474 −47,808
Reserve assets 3,013 932 1,181 797 −384
Net U.S. incurrence of liabilities excluding financial derivatives (net increase in liabilities / financial inflow (+)) 230,257 656,055 516,175 671,186 155,011
Direct investment liabilities 97,255 125,653 70,929 101,387 30,458
Portfolio investment liabilities −61,631 246,077 443,379 463,168 19,789
Other investment liabilities 194,633 284,325 1,867 106,631 104,764
Financial derivatives other than reserves, net transactions −23,095 5,762 −45,911 −33,940 11,971
Statistical discrepancy          
Statistical discrepancy1 22,734 48,718 90,326 −82,251 −172,577
Balances          
Balance on current account −224,837 −282,540 −238,727 −217,106 21,621
Balance on goods and services −225,000 −282,751 −253,603 −210,598 43,005
Balance on goods −285,019 −341,676 −310,875 −271,139 39,736
Balance on services 60,020 58,925 57,272 60,542 3,270
Balance on primary income 36,993 38,819 57,214 45,621 −11,593
Balance on secondary income −36,831 −38,608 −42,338 −52,129 −9,791
Balance on capital account −1,844 −1,888 −3,815 5,198 9,013
Net lending (+) or net borrowing (−) from current- and capital-account transactions2 −226,681 −284,428 −242,542 −211,908 30,634
Net lending (+) or net borrowing (−) from financial-account transactions3 −203,948 −235,710 −152,216 −294,159 −141,943
p
Preliminary
r
Revised

Table Footnotes

  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 $26.5 billion to $1.14 trillion in the third quarter (charts 2 and 3 and tables A and B). Imports of goods and services from, and income paid to, foreign residents increased $4.8 billion to $1.35 trillion (charts 2 and 4 and tables A and C).

Chart 2. Current-Account Transactions

[View larger chart]

Trade in goods

Exports of goods increased $7.2 billion to $547.0 billion, reflecting increases in nonmonetary gold and in capital goods, mostly civilian aircraft engines and parts and other industrial machinery, that were partly offset by a decrease in foods, feeds, and beverages, mostly soybeans and corn. Imports of goods decreased $32.5 billion to $818.2 billion, reflecting widespread decreases in consumer goods and in industrial supplies and materials. The decrease in consumer goods was led by household and kitchen appliances and other household goods, and the decrease in industrial supplies and materials was led by metals and nonmetallic products.

Trade in services

Exports of services increased $4.9 billion to $234.0 billion, reflecting increases in other business services, mainly professional and management consulting services, and in travel, mostly education-related travel and other personal travel. Imports of services increased $1.6 billion to $173.5 billion, reflecting increases in travel, mostly other personal travel and education-related travel, and in financial services, mostly financial intermediation services indirectly measured and financial management services, that were partly offset by a decrease in transport, mostly sea freight transport.

Primary income

Receipts of primary income increased $15.2 billion to $314.0 billion, and payments of primary income increased $26.8 billion to $268.4 billion. The increases in both receipts and payments primarily reflected increases in other investment income, mostly interest on loans and deposits. These increases were mainly due to higher short-term interest rates that resulted from significant federal funds rate hikes by the Federal Reserve Board in May, June, July, and September. U.S. other investment assets and liabilities are mainly denominated in U.S. dollars.

Secondary income

Receipts of secondary income decreased $0.8 billion to $42.7 billion, reflecting a decrease in general government transfers, mostly fines and penalties. Payments of secondary income increased $9.0 billion to $94.9 billion, reflecting an increase in general government transfers, mostly international cooperation.

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

[View larger chart]
Chart 4. Percent Change in Imports of Goods and Services and Income Payments

[View larger chart]
Table B. Exports of Goods and Services and Income Receipts
[Millions of dollars, seasonally adjusted]
Series 2021 2022 Change 2022:Q2 to 2022:Q3
Q4 Q1 Q2r Q3p
Exports of goods and services and income receipts 1,001,171 1,025,046 1,111,290 1,137,754 26,464
Exports of goods 473,521 487,899 539,793 547,019 7,226
General merchandise 466,835 481,727 530,178 531,254 1,076
Foods, feeds, and beverages 44,085 44,326 50,310 44,889 −5,421
Industrial supplies and materials 171,104 184,174 218,138 214,289 −3,849
Energy products 79,352 87,102 116,627 114,321 −2,306
Of which: Petroleum and products 62,146 70,824 90,485 85,970 −4,515
Nonenergy products 91,752 97,072 101,511 99,968 −1,543
Capital goods except automotive 134,784 138,700 140,858 146,361 5,503
Automotive vehicles, parts, and engines 37,131 37,564 39,271 39,766 495
Consumer goods except food and automotive 63,305 59,547 62,928 63,364 436
Other general merchandise 16,427 17,415 18,673 22,586 3,913
Net exports of goods under merchanting 175 245 166 226 60
Nonmonetary gold 6,510 5,928 9,449 15,540 6,091
Exports of services1 212,959 216,829 229,176 234,043 4,867
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. 3,146 3,212 3,613 3,655 42
Transport 18,969 20,019 23,003 22,615 −388
Travel (for all purposes including education) 23,856 25,468 33,801 35,643 1,842
Business 4,583 4,986 6,611 7,155 544
Personal 19,274 20,482 27,190 28,489 1,299
Construction 860 410 492 421 −71
Insurance services 6,012 5,181 5,442 5,374 −68
Financial services 43,714 41,518 41,368 41,197 −171
Charges for the use of intellectual property n.i.e. 32,646 31,583 31,817 31,654 −163
Telecommunications, computer, and information services 16,044 16,254 17,027 17,659 632
Other business services 55,708 59,220 58,784 61,979 3,195
Personal, cultural, and recreational services 5,912 6,040 7,248 6,481 −767
Government goods and services n.i.e. 6,091 7,924 6,579 7,364 785
Primary income receipts 271,520 278,059 298,761 313,971 15,210
Investment income 269,774 276,301 296,995 312,198 15,203
Direct investment income 145,836 146,562 158,043 161,566 3,523
Income on equity 142,309 143,147 154,311 157,345 3,034
Dividends and withdrawals 37,632 92,100 84,238 95,171 10,933
Reinvested earnings 104,676 51,046 70,073 62,174 −7,899
Interest 3,527 3,416 3,732 4,221 489
Portfolio investment income 108,943 115,345 120,339 120,135 −204
Income on equity and investment fund shares 73,342 76,776 79,468 76,681 −2,787
Interest on debt securities 35,601 38,569 40,871 43,454 2,583
Other investment income 14,961 14,311 18,340 29,895 11,555
Reserve asset income 35 83 273 601 328
Compensation of employees 1,746 1,758 1,766 1,774 8
Secondary income (current transfer) receipts2 43,173 42,259 43,561 42,721 −840
p
Preliminary
r
Revised
n.a.
Not available
n.i.e.
Not included elsewhere

Table Footnotes

  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 2021 2022 Change 2022:Q2 to 2022:Q3
Q4 Q1 Q2r Q3p
Imports of goods and services and income payments 1,226,009 1,307,586 1,350,017 1,354,860 4,843
Imports of goods 758,540 829,575 850,668 818,159 −32,509
General merchandise 751,544 818,169 844,745 814,222 −30,523
Foods, feeds, and beverages 48,452 52,067 54,695 51,875 −2,820
Industrial supplies and materials 180,547 197,086 217,409 206,069 −11,340
Energy products 69,555 78,292 93,687 90,377 −3,310
Of which: Petroleum and products 63,684 71,110 85,296 81,439 −3,857
Nonenergy products 110,992 118,794 123,722 115,692 −8,030
Capital goods except automotive 199,334 214,988 216,613 220,835 4,222
Automotive vehicles, parts, and engines 86,467 94,813 99,425 102,743 3,318
Consumer goods except food and automotive 202,203 228,146 226,928 205,336 −21,592
Other general merchandise 34,541 31,070 29,676 27,364 −2,312
Nonmonetary gold 6,996 11,406 5,923 3,937 −1,986
Imports of services1 152,939 157,904 171,904 173,502 1,598
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. 2,020 2,010 2,155 2,114 −41
Transport 31,403 35,666 41,411 39,434 −1,977
Travel (for all purposes including education) 19,840 20,474 28,922 30,428 1,506
Business 2,047 1,973 3,325 3,739 414
Personal 17,794 18,501 25,597 26,690 1,093
Construction 448 359 416 364 −52
Insurance services 15,646 13,807 14,323 14,371 48
Financial services 13,546 12,639 12,671 13,944 1,273
Charges for the use of intellectual property n.i.e. 10,966 14,375 11,730 12,499 769
Telecommunications, computer, and information services 11,438 11,693 12,001 11,702 −299
Other business services 34,047 33,479 34,364 35,099 735
Personal, cultural, and recreational services 7,300 7,079 7,535 7,233 −302
Government goods and services n.i.e. 6,284 6,323 6,377 6,313 −64
Primary income payments 234,527 239,239 241,547 268,350 26,803
Investment income 229,966 234,040 236,305 263,157 26,852
Direct investment income 78,483 75,242 67,861 75,651 7,790
Portfolio investment income 133,377 141,233 144,987 149,177 4,190
Income on equity and investment fund shares 48,228 52,088 51,919 49,073 −2,846
Interest on debt securities 85,149 89,145 93,068 100,104 7,036
Other investment income 18,105 17,565 23,457 38,329 14,872
Compensation of employees 4,561 5,199 5,241 5,193 −48
Secondary income (current transfer) payments2 80,003 80,867 85,898 94,850 8,952
Supplemental detail on insurance transactions:          
Premiums paid 40,097 36,019 38,081 38,307 226
Losses recovered 25,407 25,088 25,004 33,872 8,868
p
Preliminary
r
Revised
n.a.
Not available
n.i.e.
Not included elsewhere

Table Footnotes

  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.

Capital-transfer receipts were $9.1 billion in the third quarter. The transactions reflected receipts from foreign insurance companies for losses resulting from Hurricane Ian. For information on transactions associated with hurricanes and other disasters, see “How do losses recovered from foreign insurance companies following natural or man-made disasters affect foreign transactions, the current account balance, and net lending or net borrowing?”

Net financial-account transactions were −$294.2 billion in the third quarter, reflecting net U.S. borrowing from foreign residents.

Financial assets

Third-quarter transactions increased U.S. residents' foreign financial assets by $411.0 billion. Transactions increased portfolio investment assets, mostly equity and long-term debt securities, by $368.9 billion; direct investment assets, mainly equity, by $56.7 billion; and reserve assets by $0.8 billion. Transactions decreased other investment assets by $15.5 billion, resulting from partly offsetting transactions in loans and deposits.

Liabilities

Third-quarter transactions increased U.S. liabilities to foreign residents by $671.2 billion. Transactions increased portfolio investment liabilities, mostly long-term debt securities and equity, by $463.2 billion; other investment liabilities, mostly loans, by $106.6 billion; and direct investment liabilities, mostly equity, by $101.4 billion.

Financial derivatives

Net transactions in financial derivatives were −$33.9 billion in the third quarter, reflecting net U.S. borrowing from foreign residents.

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

[View larger chart]
Chart 6. Transactions in Financial Assets and Liabilities Excluding Financial Derivatives

[View larger chart]
Table D. Net U.S. Acquisition of Financial Assets and Net U.S. Incurrence of Liabilities
[Millions of dollars, seasonally adjusted]
Series 2021 2022 Change 2022:Q2 to 2022:Q3
Q4 Q1 Q2r Q3p
Net U.S. acquisition of financial assets excluding financial derivatives (net increase in assets / financial outflow (+)) 49,404 414,584 409,870 410,967 1,097
Direct investment assets 64,912 134,008 99,641 56,720 −42,921
Equity 142,683 126,235 82,581 78,078 −4,503
Equity other than reinvestment of earnings 38,007 75,189 12,508 15,904 3,396
Reinvestment of earnings 104,676 51,046 70,073 62,174 −7,899
Debt instruments −77,771 7,773 17,060 −21,358 −38,418
Portfolio investment assets −106,715 227,966 276,714 368,923 92,209
Equity and investment fund shares −153,474 113,208 238,719 232,184 −6,535
Debt securities 46,759 114,759 37,995 136,739 98,744
Short-term securities −49,821 −60,384 −32,045 27,238 59,283
Long-term corporate securities 67,355 132,144 53,657 82,257 28,600
Other long-term securities 29,225 42,999 16,383 27,244 10,861
Other investment assets 88,194 51,678 32,334 −15,474 −47,808
Other equity 0 0 0 0 0
Currency and deposits 76,553 29,188 15,681 81,184 65,503
Loans 10,079 28,703 16,406 −97,775 −114,181
Trade credit and advances 1,563 −6,213 248 1,118 870
Reserve assets 3,013 932 1,181 797 −384
Monetary gold 0 0 0 0 0
Special drawing rights 835 1,517 1,521 704 −817
Reserve position in the International Monetary Fund 2,169 −596 −366 131 497
Other reserve assets 9 11 26 −38 −64
Net U.S. incurrence of liabilities excluding financial derivatives (net increase in liabilities / financial inflow (+)) 230,257 656,055 516,175 671,186 155,011
Direct investment liabilities 97,255 125,653 70,929 101,387 30,458
Equity 102,069 74,242 75,227 86,519 11,292
Equity other than reinvestment of earnings 45,554 24,310 29,731 34,426 4,695
Reinvestment of earnings 56,515 49,932 45,496 52,093 6,597
Debt instruments −4,814 51,411 −4,298 14,868 19,166
Portfolio investment liabilities −61,631 246,077 443,379 463,168 19,789
Equity and investment fund shares −279,938 −130,365 274,100 208,599 −65,501
Debt securities 218,307 376,442 169,279 254,569 85,290
Short-term securities 53,110 76,997 −105,120 42,398 147,518
Treasury bills and certificates 59,028 20,988 −113,904 25,116 139,020
Federally sponsored agency securities 309 248 3,058 3,596 538
Other short-term securities −6,227 55,761 5,726 13,686 7,960
Long-term securities 165,198 299,445 274,399 212,171 −62,228
Treasury bonds and notes 145,684 193,165 147,077 135,495 −11,582
Federally sponsored agency securities 16,934 −12,649 98,308 29,603 −68,705
Corporate bonds and notes 2,124 112,061 25,684 45,407 19,723
Other long-term securities 456 6,868 3,330 1,666 −1,664
Other investment liabilities 194,633 284,325 1,867 106,631 104,764
Other equity n.a. n.a. n.a. n.a. n.a.
Currency −12,459 113,793 10,527 29,491 18,964
Deposits 197,963 168,218 −15,701 73,095 88,796
Loans n.a. n.a. n.a. n.a. n.a.
Trade credit and advances 9,129 2,314 7,041 4,045 −2,996
Special drawing rights allocations 0 0 0 0 0
p
Preliminary
r
Revised
n.a.
Not available

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 second quarter of 2022 have been updated to incorporate newly available and revised source data and updated seasonal adjustments (table E).

Table E. Updates to Second-Quarter 2022 International Transactions Aggregates
[Millions of dollars, seasonally adjusted]
Series Preliminary estimates Revised estimates
Balance on current account −251,090 −238,727
Balance on goods −310,529 −310,875
Balance on services 57,090 57,272
Balance on primary income 43,644 57,214
Balance on secondary income (current transfers) −41,295 −42,338
Net lending or borrowing from financial-account transactions −159,524 −152,216
Net U.S. acquisition of financial assets 386,235 409,870
Net U.S. incurrence of liabilities 499,848 516,175
Financial derivatives other than reserves, net transactions −45,911 −45,911