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U.S. international transactions in 2000
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Abstract
The U.S. current account deficit widened to 435billionin2000,arecord4.4percentofgrossdomesticproduct,asthelaggedeffectofstronggrowthintheU.S.economyinlate1999andearly2000continuedtodriveupimportsofgoodsandservicesfasterthanexportsincreased.Toalesserextent,adeclineinU.S.pricecompetitivenessalsocontributedtotheexpansioninthedeficit.The104 billion increase in the current account deficit was entirely accounted for by an equal-sized increase in the goods and services deficit. Other components of the current account moved in small and offsetting directions. The current account deficit represents an excess of U.S. investment over U.S. saving of more than 400billion.Inaddition,almost300 billion of U.S. saving flowed abroad in the form of a continued increase in foreign direct and portfolio investment by U.S. residents. To finance the current account deficit and the capital outflow, the foreign private sector purchased a record amount--more than $700 billion--of U.S. securities and direct investment assets. The sharp slowdown in U.S. economic growth in late 2000 and early 2001 should reduce the rate of increase of the current account deficit in 2001 through a slowing of the rate of growth of goods and services imports.International trade ; Exports ; Imports