The current account deficit in the balance of payments of the United States increased in the I quarter, which was facilitated by the growth of imports of goods, according to Reuters.
According to the country’s Department of Commerce, the current account deficit of the US balance of payments in January-March increased by 6.9% to $ 124.1 billion.
The indicator measures the flow of goods, services and investments to and from a country.
According to revised data, in the IV quarter of 2017, the current account deficit amounted to $ 116.1 billion, and not $ 128.2 billion, as previously reported.
Analysts polled by Reuters on average expected current account deficits to reach $ 129 billion in Q1.
The deficit amounted to 2.5% of GDP in the I quarter compared to 2.4% of the GDP in the previous quarter. The peak value of the indicator (6.3% of GDP) was recorded in 2005.
It is noted that an increase in the current account deficit of the balance of payments by $ 8 billion reflects an increase in the deficit of trade in goods by $ 8.1 billion and relatively small and almost compensating changes in the balance of services, the balance of primary and secondary income.
The US Department of Commerce also said that tax reform has prompted many companies to return money to the country from abroad.
US companies paid more than $ 300 billion in dividends from repatriated earnings.
According to Vesti.Ekonomika, in December, US President Donald Trump signed into law a tax reform that provides for companies to reduce their income tax rates from 35% to 21%.
Zillow: US Mortgage Availability Decreases
According to estimates by a leading US online information portal specializing in real estate, the availability of mortgage loans in the US has fallen to the levels of the financial crisis.
Marketplace experts noted that in the first quarter of 2018, the share of monthly mortgage payments in the budget of American households increased to 17.1% of their income. According to a Zillow study, similar values in the US were observed in 2009.
According to estimates made by Zillow, the current indicator of housing affordability in the USA as a whole is higher than the average values for the period 1985–2000, when the share of mortgage payments in the USA averaged 21.1% of monthly income. However, at the same time, the growth of the indicator from 15.9% in the IV quarter of 2017 to 17.1% in the I quarter of 2018 «became one of the largest quarterly increases in the mortgage burden since the financial crisis.»
For large cities on the east and west coast of the United States, in particular in New York, Boston, Los Angeles and several other cities, the share of mortgage payments on average exceeds 40% of American income.
Zillow senior economist Aaron Terrazas noted that the availability of housing in the United States is noticeably reduced amid rising mortgage rates and a sharp rise in the price of real estate:
“Over the past few years, historically low mortgage rates have mitigated to some extent the effect of rising real estate prices. Now that rates are rising and property prices are rising at the fastest pace in the past 12 years, housing affordability is noticeably declining. ”
US automakers warn of rising prices
US automakers warn Donald Trump that due to the introduction of duties on imported cars, buyers in the United States will overpay $ 45 billion annually.
If the White House nevertheless introduces 25% of the import duty on passenger cars, US buyers will pay $ 45 billion annually, a warning from the United States Automakers Alliance, which includes auto giants like General Motors Co, Toyota Motor Corp, Volkswagen AG and other companies.
According to his calculations, each vehicle will rise in price by $ 5.8 thousand. This eliminates the effect of tax cuts, designed to support American companies.
In addition, the Alliance is warning that consumers will also face a rise in prices for auto parts. The organization intends to notify the Department of Commerce of the possible consequences.
The Trump administration intends to introduce import duties on imported cars and components, insisting that the EU remove trade barriers for American products. At the same time, both market participants and experts are sure that American companies will suffer from this as well. Earlier, Moody`s agency warned that giants such as GM and Ford would be hit.
In addition, the introduction of, in fact, protective duties, will increase the escalation of trade confrontation with the EU. The damage from them for European companies will be much more than what will cause the increase in tariffs on steel imports. The American market is the largest market for Europeans. $ 44 billion worth of cars are sent there annually.
At the same time, experts are sure that if EU duties are introduced, the response will not hesitate.
