“The ease with which the United States has financed its record current account deficit has been remarkable, but is unlikely to be sustained indefinitely. A number of (possibly temporary) factors, such as short-term interest rate differentials and increasing demand for long-term bonds, have helped support the U.S. current account deficit and dollar over the past year. However, most forecasters project that the current account deficit will rise further in coming years, which may begin to strain the global appetite for U.S. assets. Delaying the inevitable multilateral adjustment will mean continued increases in U.S. external indebtedness, magnifying the potential for disruption to exchange rates, financial markets, and growth, both domestically and abroad.”
- United States of America—2006 Article IV Consultation, Concluding Statement of the IMF Mission
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The U.S. Current Account Deficit Once Again- Brad De Long’s Afternoon Tea.
Allen Sinai chief economist at Decision Economics, talks with Bloomberg's Tom Keene about stagflation risk in the U.S. and Federal Reserve Chairman Ben S. Bernanke's comments about monetary policy..
