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US current account deficit narrows in the second quarter

The CMA CGM SA operated Benjamin Franklin sits docked at the Port of Los Angeles.
Tim Rue | Bloomberg | Getty Images
The CMA CGM SA operated Benjamin Franklin sits docked at the Port of Los Angeles.

The U.S. current account deficit narrowed in the second quarter as exports and income from abroad rose, government data showed on Thursday.

The Commerce Department said the current account deficit, which measures the flow of goods, services and investments into and out of the country, fell to $119.9 billion from an upwardly revised $131.8 billion the first quarter.

Economists polled by Reuters had forecast the current account deficit declining to $120.5 billion from a previously reported $124.67 billion shortfall.

The second-quarter current account deficit represented 2.6 percent of gross domestic product, down from 2.9 percent in the first three months of 2016. The current account deficit has declined from a record high of 6.3 percent of GDP in the fourth quarter of 2005, as rising domestic oil production and lower international oil prices keep the import bill in check.

In the second quarter, the surplus on primary income — which includes dividends — increased to $42.9 billion from $34.0 billion in the second quarter. The deficit on secondary income, worker remittances and grants, fell $3.1 billion to $37.6 billion.

Goods exports rose $6.1 billion to $360.2 billion.