Preview: Due June 24 - U.S. Q1 Current Account - Deficit showing signs of stabilizing
We expect a Q1 US current account deficit of $206.8bn, up from $190.7bn in Q4 which would be the first increase in the deficit since the record pre-tariff deficit of $438.3bn in Q1 2025. The deterioration from Q4 could however be modest with trade data suggesting that Q4’s deficit will be revised higher.
Q1 goods and services trade data has already been released with monthly data. The goods deficit of $250.9bn was down from $259.4bn in Q4 but Q4’s deficit has been revised from $241.5bn seen in the Q4 current account release. The services surplus increased to $85.1bn from $82.1bn in Q4, Q4 revised from $81.4bn in the Q4 current account release.
Still to be released are data on primary (investment) income and secondary (unilateral transfers) income. Fed flow of funds data however suggests the former will see the surplus fall to around half the level of seen in a sharply improved Q4 while the latter is likely to see only a marginal dip in its deficit. As a proportion of GDP the deficit is set to increase to 2.6% from 2.4% in Q4.
