Clearly, America's current account deficit is unsustainable.

Even the current account showed a deficit in January.

The counterargument hinges on the difference between the current account deficit and the trade deficit.

Thus, in order to keep the current account deficit stable, the trade deficit must shrink.

The other way the current account deficit could come to an end is if the inflow of capital into America stops.

The US current account deficit and the Asian surplus will shrink.

The annual capital inflow is equal each year to the US current account deficit the sum of the trade deficit plus the net interest and dividends that America s government and businesses owe to the rest of the world. The fall in the capital inflow would therefore bring with it a fall in the trade deficit.

If foreign debt matters more than public debt, the key variable requiring adjustment is the external deficit, not the fiscal deficit. A country that has a balanced current account does not need any additional foreign capital.

It then cites global current account imbalances, particularly the US external deficit, describing it as unprecedented for a reserve currency country to have a current account deficit of such magnitude.

It then cites global current account imbalances, particularly the US external deficit, describing it as unprecedented for a reserve currency country to have a current account deficit of such magnitude.

Why can t the US current account deficit remain at its 2006 value indefinitely?

The current account deficit has been almost eliminated, and the banking crisis contained.

The current account deficit has been almost eliminated, and the banking crisis contained.

The current account deficit is equal to the trade deficit plus the cost of servicing the net international asset position the net rent, interest, and dividends owed to foreigners who have invested their capital in the US.

The annual capital inflow is equal each year to the US current account deficit the sum of the trade deficit plus the net interest and dividends that America s government and businesses owe to the rest of the world.

But the eurozone can increase its inflow of foreign capital only if it has a current account deficit, i.e., if it increases its imports relative to its exports.

But a chronic current account deficit is unsound, unfair, and unsustainable in the long run.

The US current account deficit has been the most widely discussed indicator of global imbalances.

That could bring its current account into balance or even into slight deficit by 2015.

Yet the quarterly US current account deficit actually increased from 195 billion to 205 billion.

Doesn t the country s persistent current account deficit reflect excessive consumption, rather than weak effective demand?

The US alone ran a current account deficit of 739 billion (5.3 of its GDP).

After all, America s still large current account deficit guarantees that the dollar will continue to fall.

The United States' current account deficit reached 5.7 of GDP in the second quarter of 2004.

With the current account deficit now exceeding 5 of GDP, US foreign debt is rising fast.

This is why capital account regulations are allowed under IMF rules, and why the attempt to introduce capital account convertibility into the IMF s Articles of Agreement was defeated in 1997.

Third, the net flow of capital is from emerging markets to the US this is what it means to have current account surpluses in emerging markets and a deficit in the US.

Since 2007, the US current account deficit has narrowed, but not because of a higher savings rate.

Germany experienced a consumption and construction boom after unification, with full employment and a current account deficit.

Once upon a time, until 1997, America's current account deficit was relatively small just 1 of GDP.

At the onset of its crisis, Argentina s budget deficit, public debt, and current account deficit (as a share of GDP) were about 3 , 50 and 2 , respectively.

The current account deficit is increasing relentlessly, owing to a widening trade deficit (now at 13 of GDP), raising the danger of a balance of payments crisis.

The US current account deficit, which is identical to net capital imports, grew steadily to an annual 811 billion in 2006, or 6 of GDP by far the largest since the Great Depression.

The US current account deficit, which is identical to net capital imports, grew steadily to an annual 811 billion in 2006, or 6 of GDP by far the largest since the Great Depression.

That would be very difficult to manage without some form of capital account regulation.

Sweden accumulated a current account surplus of 53 of GDP, in contrast to America s 48 of GDP deficit.

The ever rising current account deficit (6.8 of GDP in 2010) will require a second round of reforms.

Indeed, the world itself cannot afford the disappearance of the US current account deficit at least not quickly.

Among other high growth countries, Vietnam s current account is essentially balanced, and India has only a small deficit.

And the 65 billion needed every month to fund the US current account deficit continues to flow in.

Rebalancing also involves a global demand switch from external deficit countries to those running large current account surpluses.

Among other high growth countries, Vietnam s current account is essentially balanced, and India has only a small deficit.

In the short run, the US current account deficit will remain, regardless of which country runs bilateral surpluses.

The only effective response is counter cyclical capital account management discouraging foreign borrowing during economic upswings and preventing capital flight during downswings.

A country with current account and capital account surpluses and increasing foreign exchange reserves normally sees an excessive money supply and high inflation.