The US current account deficit ballooned to a record $166 billion (€135 billion) in the second quarter, underlining the mounting imbalances in the global economy.

The deficit was unprecedented both in dollar terms and relative to the size of the economy, reaching 5.7 per cent of national income.

Economists said it raised the risk of a further slide in the dollar but that there were no signs so far that the US was struggling to attract foreign capital to finance the gap.

"This is an accident waiting to happen," said Nigel Gault, director of US research at Global Insight. "But the accident might not necessarily happen any time soon."

The US has been helped in funding the deficit by Asian central banks, which have been buying dollars to prevent appreciation of their currencies from damaging exports. Private-sector demand for US assets has also held up.

The deficit on goods and services widened to $150.3 billion from $138.6 billion in the first quarter. The overall current account gap was also boosted by a surge in payments due to foreign owners of assets in the US, which increased by $12.8 billion to $82 billion.

The current account figures coincided with the release of solid retail sales figures. Sales fell 0.3 per cent in August, depressed by a retreat in auto sales.

But excluding the auto sector, sales rose by 0.2 per cent in August, a growth rate similar to previous months.

The figures will add to the conviction among economists that consumers are in no position to drive growth in the US.

With mortgage refinancing and tax rebates no longer giving a boost, spending rises have become dependent on earnings growth.

Barring an unexpected surge in earnings growth, most economists expect spending to rise only moderately in coming months.