US Current Account Deficit Jumps 15.7% in Q2

The US current account deficit widened sharply in the second quarter of 2026, increasing by $33.4 billion, or 15.7%, to $246 billion as imports of goods surged, according to data released by the U.S. Bureau of Economic Analysis on September 24.

The increase highlights the growing gap between the value of goods, services and investment income flowing into the United States and the value flowing out. The second-quarter deficit was equal to 3.0% of U.S. gross domestic product, up from 2.7% in the first quarter. BBureau of Economic Analysis+1

The latest figures also show that the deterioration was driven primarily by goods trade. Imports of goods increased substantially more than exports, pushing the goods deficit higher and making international trade a significant drag on economic growth during the quarter.

US Current Account Deficit Reaches $246 Billion

The Bureau of Economic Analysis said the US current account deficit reached $246.0 billion in the April-June period.

That compared with a revised first-quarter deficit of $212.6 billion. The first-quarter figure was revised down from the previously reported $226.8 billion.

Economists surveyed by Reuters had expected the second-quarter deficit to reach approximately $255 billion. The actual figure therefore came in below the median forecast, although it still represented a significant increase from the revised first-quarter level. IInvesting.com

The current account measures several components of international economic activity. These include trade in goods and services, income earned from overseas investments and payments made to foreign investors, as well as certain transfers.

As a result, the measure provides a broader picture of the U.S. external economic position than the goods trade balance alone.

Goods Imports Drive the Increase

The biggest factor behind the widening deficit was the increase in goods imports.

According to the latest data, U.S. goods imports increased by $67.4 billion, reaching $931.6 billion in the second quarter.

Goods exports also increased, but by a substantially smaller amount. Exports rose $27.1 billion to $640.3 billion.

The difference between those movements caused the goods trade deficit to widen by $40.4 billion, reaching $291.3 billion. IInvesting.com+1

The figures illustrate why the overall current account balance deteriorated despite growth in exports.

Put simply, American businesses and consumers bought considerably more goods from overseas, while the increase in U.S. goods sales abroad was not large enough to offset the rise in imports.

That imbalance became the central driver of the second-quarter deterioration.

Trade Weighed on US Economic Growth

The larger trade deficit also had an impact on measured U.S. economic growth.

Trade subtracted 1.14 percentage points from GDP growth in the second quarter, according to the Reuters report based on government data. Trade has now been a drag on GDP for three consecutive quarters. IInvesting.com

The relationship between trade and GDP can be complicated because imports are deducted from the GDP calculation. A surge in imports can therefore reduce measured GDP growth even when strong domestic demand is contributing to those purchases.

The latest data should consequently be viewed alongside broader economic indicators rather than interpreted as a standalone measure of economic strength.

Still, the size of the trade contribution shows that international commerce played a meaningful role in the second-quarter economic picture.

Current Account Deficit Rises as Share of GDP

The second-quarter US current account deficit represented 3.0% of current-dollar GDP.

That was an increase from 2.7% in the first quarter.

The deficit remains below the historical peak recorded in the third quarter of 2006, when the current account gap reached 6.3% of GDP. IInvesting.com+1

The comparison is important because the current-account balance can vary considerably over time depending on domestic demand, international investment flows, commodity prices, exchange rates and global economic conditions.

The latest result therefore does not represent an unprecedented level of external imbalance. However, the quarter-to-quarter increase underscores how quickly the balance can change when imports rise sharply.

Services Continue to Offset Part of the Goods Gap

The United States does not run a deficit across every component of its international accounts.

The country has historically generated significant surpluses in services, which can offset part of its large goods deficit.

The BEA’s second-quarter figures show that exports of goods and services, combined with income received from foreign residents, rose by $58.8 billion to approximately $1.44 trillion.

At the same time, imports of goods and services and income paid to foreign residents increased by $92.2 billion to roughly $1.69 trillion. BBureau of Economic Analysis

The difference between those two totals helps explain why the current account moved further into deficit.

The increase in outflows was larger than the increase in inflows.

Primary Income Balance Also Changes

Investment income was another component of the second-quarter data.

The primary income balance narrowed to a surplus of $11.4 billion from $15.8 billion in the first quarter, according to Reuters.

Primary income receipts increased to $416.2 billion from $391.5 billion. However, primary income payments rose even more, reaching $427.6 billion compared with $407.3 billion in the first quarter. IInvesting.com

This means that while U.S. residents continued to receive substantial income from investments and other assets abroad, payments to foreign investors increased at a faster pace during the quarter.

That development added to the overall deterioration in the external balance.

US International Investment Position Deteriorates

The latest data also showed a deterioration in the United States’ net international investment position.

The measure represents the difference between U.S. residents’ foreign financial assets and their liabilities to foreign residents.

At the end of the second quarter, the net international investment position stood at negative $22.42 trillion, compared with a revised negative $21.27 trillion at the end of the first quarter. BBureau of Economic Analysis

U.S. residents held $46.97 trillion in foreign assets, while liabilities to foreign residents totaled $69.39 trillion.

The BEA said U.S. assets increased by $3.72 trillion during the second quarter, while liabilities increased by $4.87 trillion. Much of the movement reflected changes in asset prices, alongside financial transactions. BBureau of Economic Analysis

The investment-position figures provide additional context for the country’s international financial exposure.

What the Data Mean for the US Economy

The latest US current account deficit figures point to a combination of strong import demand and continuing external imbalances.

The increase in goods imports was particularly notable. Imports rose by more than twice the dollar amount of the increase in goods exports during the quarter.

However, the current account should not be confused with the federal budget deficit.

The current account measures transactions between the United States and the rest of the world. The federal budget deficit, by contrast, reflects the difference between federal government spending and revenue.

Both are important economic indicators, but they measure different aspects of the economy.

The United States is also in a distinctive position because the dollar is the world’s primary reserve currency. That status affects how global investors, companies and governments use and hold U.S. financial assets.

Why Imports Matter

Imports can rise for many reasons.

Businesses may purchase foreign-made machinery, components and other inputs. Consumers may buy imported products. Companies can also increase inventories using goods sourced from overseas.

Consequently, a larger current-account deficit does not automatically indicate that domestic economic activity is weakening.

In some circumstances, stronger domestic demand can actually contribute to a larger import bill.

The second-quarter figures show that imports increased considerably, but they do not by themselves establish why every category of imports rose or whether the increase will persist in subsequent quarters.

Future data will therefore be important in determining whether the second-quarter jump represents a temporary movement or part of a longer trend.

Current Account and the Dollar

The Reuters report noted that the current account deficit does not directly determine the value of the U.S. dollar, particularly given the currency’s status as the world’s leading reserve currency. IInvesting.com

Nevertheless, persistent external deficits can remain an important consideration for economists and investors because they are connected to international capital flows.

The United States finances its external position through capital and financial transactions involving foreign investors and U.S. assets.

The BEA reported net financial-account transactions of negative $369.7 billion in the second quarter, reflecting net U.S. borrowing from foreign residents. BBureau of Economic Analysis

These flows demonstrate the close connection between the current account and the financial account within the broader balance of payments.

A Larger Deficit Does Not Tell the Whole Story

The headline increase in the US current account deficit is significant, but economists generally examine several measures together before drawing conclusions about the economy.

The trade balance, domestic demand, services exports, investment income, capital flows and the international investment position all provide different pieces of the picture.

The second-quarter data show that the United States continued to receive substantial income from overseas assets and export large quantities of services and goods.

At the same time, imports and payments to foreign residents increased considerably.

The result was a wider overall current-account gap.

What to Watch in the Next Quarters

The next releases will provide clues about whether the second-quarter increase continues.

Investors and economists are likely to watch goods imports and exports closely, particularly because trade has already reduced GDP growth for three consecutive quarters.

Changes in consumer demand, business investment, inventories and global economic activity could all affect import volumes.

Services exports and investment income will also remain important because they can offset some of the goods deficit.

Meanwhile, changes in international financial markets can influence the value of U.S. assets and liabilities, affecting the country’s net international investment position.

The BEA’s future revisions will also matter because the first-quarter current-account deficit was revised significantly lower in the latest release.

Bottom Line

The US current account deficit widened 15.7% to $246 billion in the second quarter of 2026, with a surge in goods imports providing the main source of the increase.

Goods imports rose $67.4 billion to $931.6 billion, while goods exports increased $27.1 billion to $640.3 billion. That pushed the goods trade deficit to $291.3 billion. IInvesting.com+1

The current-account deficit reached 3.0% of GDP, compared with 2.7% in the first quarter.

At the same time, the U.S. net international investment position deteriorated to negative $22.42 trillion at the end of June.

The figures show that international trade and investment flows remain important forces shaping the U.S. economy. The next quarterly releases will help determine whether the second-quarter widening marks a temporary increase or a more persistent shift in the country’s external balance.

Sources: Reuters and the U.S. Bureau of Economic Analysis.