The U.S. current-account deficit narrowed more than expected in the third quarter, a government report showed on Tuesday.

The gap in the current account, the broadest measure of the nation's trade with the rest of the world, shrank to $135.0 billion from an upwardly revised $139.4 billion in the second quarter, the Commerce Department (search) said.

Analysts polled by Reuters had been expecting the deficit to dwindle to $136.1 billion.

Economists have said the widening of the current-account deficit (search) in previous quarters has contributed to a weakening in the value of the U.S. dollar against other major currencies.

The dollar hit a record low against the euro and a three-year low against the yen last week as worries grew about America's ability to fund its current account gap.

The deficit in trade in goods narrowed to $136.2 billion in the third quarter from $138.1 billion, while the surplus in services trade rose to $14.9 billion from $13.9 billion.

At the same time, the deficit in government transfer payments (search), such as foreign aid and Social Security payments to Americans abroad, narrowed to $16.3 billion in the quarter from $16.9 billion.