US Current Account Deficit Narrows to 2 year Low

The U.S. current account deficit shrank to its narrowest in nearly two years in the third quarter as weak domestic demand and lower oil prices curbed imports, a government report showed on Tuesday.

The Commerce Department said the current account gap, which measures the flow of goods, services and investments into and out of the country, fell to $107.5 billion, the lowest level since the fourth quarter of 2010, from $118.1 billion in the second quarter.

That represented 2.7 percent of gross domestic product, the smallest share since the second quarter of 2009, and down from 3.0 percent in the second quarter.

The smaller deficit, if sustained, should help support the dollar, even as the Federal Reserve continues its aggressive easing policy to boost economic growth.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, he established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza