The Department of Commerce reported on Friday that current account (C/A) gap in the U.S. narrowed by 0.1 percent q-o-q to $104.2 billion in the first quarter of 2020 from a downwardly revised $104.3 billion gap in the previous quarter (originally -$109.8 billion). This was the lowest shortfall since the second quarter of 2018, in part due to the impact of COVID-19, as many businesses were operating at limited capacity or ceased operations completely, and the movement of travelers across borders was restricted.

The deficit was 1.9 percentage of current-dollar GDP in the first quarter, p less than 0.1 percentage point from the fourth quarter of 2019.

Economists had forecast a deficit of $103 billion.

According to the report, the $0.1 billion narrowing of the C/A deficit in the first quarter mainly reflected a reduced deficit on goods that was largely offset by a decreased surplus on primary income and an expanded deficit on secondary income.

Exports of goods and services to, and income received from, foreign residents fell $47.5 billion, to $902.3 billion, in the first quarter. At the same time, imports of goods and services from, and income paid to, foreign residents dropped $47.7 billion, to $1.01 trillion.

Receipts of primary income declined $27.8 billion, to $255.1 billion, and payments of primary income fell $18.3 billion, to $202.7 billion. The decreases in both receipts and payments mainly reflected drops in direct investment income, mainly earnings.

Meanwhile, receipts of secondary income rose $0.3 billion, to $34.8 billion, and payments of secondary income increased $1.5 billion, to $72.4 billion, mainly reflected increases in private transfers, primarily private sector fines and penalties. mainly reflecting advances in private transfers, primarily private sector fines and penalties.