The U.S. current-account deficit narrowed in the third quarter to the lowest level in four years, as an increase in exports and a rise in income earned abroad partly offset a bigger deficit in goods, the government reported Tuesday. The Commerce Department said the current-account deficit, which measures the flow of goods, services, and investments into and out of the country, narrowed to $94.8 billion in the July-September period. It was the smallest imbalance since the third quarter of 2009, when the country was emerging from a deep recession. The third-quarter deficit was 1.8 percent smaller than the $96.6 billion recorded in the April-June period. The third-quarter deficit represented 2.2 percent of gross domestic product (GDP), the smallest share since the first quarter of 1998. It was down from 2.3 percent of GDP in the April-June period. The current-account imbalance has shrunk from a peak of 6.2 percent of GDP in the fourth quarter of 2005, partly because of a significant increase in the volume of oil exports. Overall, U.S. exports of goods and services increased 0.6 percent to $765.1 billion in the third quarter, while imports rose 0.4 percent. The deficit in goods increased by 1.7 percent but was offset by a 7.1 percent increase in investment earnings. Goods exports rose, reflecting a boom in energy production which has lifted U.S. energy exports to record highs. But imports were up by a larger amount, led by a big increase in shipments of foreign-made autos. Oil imports also rose during the quarter. The surplus in services rose 0.5 percent, reflecting increases in travel and in royalty payments.
