Euro area monthly balance of payments (February 2016)

In February 2016 the current account of the euro area recorded a surplus of €19 billion.^[1]

In the financial account, combined direct and portfolio investment recorded an increase of €112 billion in assets and a decrease of €9 billion in liabilities.

Current account

• The current account of the euro area recorded a surplus of €19 billion in February 2016 (see Table 1). This reflected surpluses for goods (€24.6 billion), services (€6.8 billion) and primary income (€1.4 billion), which were partly offset by a deficit in secondary income (€13.8 billion).
• The 12-month cumulated current account for the period ending in February 2016 recorded a surplus of €321.5 billion (3.1% of euro area GDP), compared with one of €269.1 billion (2.7% of euro area GDP) for the 12 months to February 2015 (see Table 1 and Chart 1). The increase in the current account surplus was largely due to an increase in the surplus for goods (from €265.1 billion to €319.9 billion) and, to a lesser extent, a decrease in the deficit for secondary income (from €140.2 billion to €130.3 billion). These were partly offset by decreases in the surpluses for services (from €73.4 billion to €65.1 billion) and for primary income (from €70.8 billion to €66.8 billion).

Financial account

In February 2016 combined direct and portfolio investment recorded an increase of €112 billion in assets and a decrease of €9 billion in liabilities (see Table 2).

Euro area residents recorded an increase of €68 billion in direct investment assets, driven by the increase in equity (€67 billion); debt instruments remained broadly unchanged. Direct investment liabilities also increased, by €21 billion, as a result of a combined increase in debt instruments (€11 billion) and equity (€10 billion).

With reference to portfolio investment assets, euro area residents made net acquisitions of foreign securities amounting to €45 billion. This resulted from net acquisitions of long-term debt securities (€65 billion), which were partly offset by net sales of equity (€16 billion) and short-term debt securities (€5 billion). The decrease of €30 billion in euro area portfolio investment liabilities was due to non-euro area residents’ net sales/amortisations of long-term debt securities (€42 billion). This was partly offset by net acquisitions of both equity and short-term debt securities issued by euro area residents (€6 billion in each case).

The euro area net financial derivatives account (assets minus liabilities) recorded positive net flows of €4 billion.

Other investment recorded increases of €53 billion in assets and €132 billion in liabilities. The increase in assets was mostly attributable to increases in the MFI sector (excluding the Eurosystem) (€42 billion) and other sectors (€8 billion). In a similar vein, the increase in liabilities was mainly driven by increases in the MFI sector (excluding the Eurosystem) (€74 billion) and other sectors (€37 billion), as well as an increase in the Eurosystem (€18 billion).

The Eurosystem recorded net acquisitions of reserve assets of €1 billion.

In the 12 months to February 2016 combined direct and portfolio investment recorded cumulated increases of €829 billion in assets and €262 billion in liabilities, compared with increases of €878 billion and €623 billion respectively in the 12 months to February 2015. There was a large increase in the direct investment activity of both euro area residents abroad and non-residents in the euro area, with the net acquisition of assets increasing from €368 billion to €494 billion and the net incurrence of liabilities increasing from €212 billion to €375 billion.

Activity in portfolio investment followed a different pattern. While the net acquisition of foreign securities by euro area residents decreased somewhat (from €510 billion to €335 billion), the level of investment is still high. This can be explained by a shift from net acquisitions to net sales of equity (from €144 billion to €1 billion) and short-term debt securities (from €89 billion to €59 billion), which was partly offset by an increase in the net acquisition of long-term debt securities (from €278 billion to €394 billion). On the liability side, there was a shift from net acquisitions of euro area securities by non-residents (€411 billion) to net sales/amortisations (€114 billion). This was attributable to the combination of lower acquisitions of equity (€95 billion, down from €310 billion), an increase in the net sales/amortisation of short-term debt securities (from €5 billion to €67 billion) and a shift from net acquisitions (€107 billion) to net sales/amortisations (€141 billion) of long-term debt securities.

According to the monetary presentation of the balance of payments, the net external assets of euro area MFIs decreased by €28.8 billion in the 12 months to February 2016, compared with an increase of €82.3 billion in the 12 months to February 2015. This development in MFIs’ net external assets continued to primarily reflect the surplus in the current and capital account balance, which has in the last 12 months been offset by, among other things, a shift from net acquisitions by non-residents of debt securities issued by euro area non-MFI residents (€77 billion) to net sales/amortisations (€100 billion).

In February 2016 the Eurosystem’s stock of reserve assets increased by €40 billion to €700 billion (see Table 3). This can be explained by the positive revaluation of monetary gold (€36 billion), exchange rate developments (€3 billion) and net acquisitions of reserve assets (€1 billion).

Data revisions

This press release incorporates revisions for January 2016. These revisions have not significantly altered the figures previously published.

Additional information

• For the first time, this press release includes a full reconciliation of the monthly changes in the Eurosystem’s reserve assets position broken down into transactions, revaluations (price and exchange rate changes) and other volume changes
• Time series data: ECB’s Statistical Data Warehouse (SDW)
• Methodological information: ECB’s website
• Monetary presentation of the balance of payments

Next press releases:

• Monthly balance of payments: 20 May 2016 (reference data up to March 2016);
• Quarterly balance of payments and international investment position: 8 July 2016 (reference data up to the first quarter of 2016).

Annexes

• Table 1: Current account of the euro area
• Table 2: Balance of payments of the euro area
• Table 3: Reserve assets of the euro area

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