US current account narrows to lowest level in four years

WASHINGTON (REUTERS) - An increase in US exports narrowed the country's current account deficit in the second quarter to its lowest level in four years, the Commerce Department said on Thursday.

The current account deficit, a broad measure of the flow of goods, services and money across national borders, dropped to US$98.9 billion (S$125 billion) in the April-June period from a revised US$104.9 billion in the prior period.

The first quarter level was the lowest since 2009. The gap was equivalent to 2.4 per cent of national economic output, the smallest ratio since 1998.

The United States' persistent current account deficit is widely seen as a problem for the global economy, although it has narrowed substantially in recent years from a record high 6.2 per cent of GDP in the fourth quarter of 2005.

Much of the narrowing came from an increase in US exports, which rose 0.9 per cent from the first quarter.

Economists polled by Reuters expected a fourth-quarter current account deficit of US$97 billion.