Euro area monthly balance of payments (June 2016)

• In June 2016 the current account of the euro area recorded a surplus of €28.2 billion.^[1]
• In the financial account, combined direct and portfolio investment recorded net acquisitions of assets of €27 billion and net incurrences of liabilities of €5 billion.

Current account

The current account of the euro area recorded a surplus of €28.2 billion in June 2016 (see Table 1). This reflected surpluses for goods (€32.9 billion) and services (€5.3 billion), which were partly offset by a deficit in secondary income (€10.1 billion). The primary income account was close to balance.

The 12-month cumulated current account for the period ending in June 2016 recorded a surplus of €347.8 billion (3.3% of euro area GDP), compared with one of €302.1 billion (2.9% of euro area GDP) for the 12 months to June 2015 (see Table 1 and Chart 1). This development was mostly due to an increase in the surplus for goods (from €306.6 billion to €368.4 billion) and to a decrease in the deficit for secondary income (from €134.8 billion to €123.4 billion). These were partly offset by decreases in the surpluses for both primary income (from €64.0 billion to €40.4 billion) and services (from €66.4 billion to €62.5 billion).

Financial account

In June 2016 combined direct and portfolio investment recorded net acquisitions of assets of €27 billion and net incurrences of liabilities of €5 billion (see Table 2).

Euro area residents recorded net disposals of €11 billion in direct investment assets, driven by net disposals of debt instruments (€23 billion), which were only partly offset by net acquisitions of equity (€12 billion). Direct investment liabilities decreased by €13 billion as a result of net disposals of debt instruments (€11 billion) and equity (€3 billion) by non-euro area residents.

As regards portfolio investment assets, euro area residents made net acquisitions of foreign securities amounting to €38 billion. This resulted from net acquisitions of short and long-term debt securities (€27 billion and €3 billion respectively) and equity (€8 billion). Portfolio investment liabilities recorded net incurrences of €19 billion as a result of the net acquisition of both equity (€37 billion) and short-term debt securities (€11 billion) issued by euro area residents, which were only partly offset by net disposals of long-term debt securities (€29 billion) by non-euro area residents.

The euro area net financial derivatives account (assets minus liabilities) recorded negative net flows of €1 billion.

Other investment recorded decreases of €43 billion in assets and €81 billion in liabilities owing to transactions. The net disposal of assets by euro area residents was mainly attributable to net disposals of the MFI sector (excluding the Eurosystem) (€49 billion), which was partly offset by net acquisitions of the general government sector (€4 billion). The net amortisation of liabilities was explained by net amortisations of the MFI sector (excluding the Eurosystem) (€78 billion) and of the other sectors (€26 billion), that were partly offset by net incurrences of the Eurosystem sector (€20 billion).

In the 12 months to June 2016 combined direct and portfolio investment recorded increases of €937 billion in assets and €309 billion in liabilities owing to transactions, compared with increases of €969 billion and €660 billion respectively in the 12 months to June 2015. This primarily reflected a shift in portfolio investment liabilities from net acquisitions of euro area securities by non-euro area residents (€256 billion) to net sales/amortisations (€99 billion).

Direct investment recorded an increase in the net acquisition of assets (from €493 billion to €530 billion) and, to a limited extent, an increase in the net incurrence of liabilities (from €405 billion to €408 billion). This pattern is explained by a large increase in investment in equity, from both euro area residents (from €284 billion to €460 billion) and non-euro area residents (from 254 billion to €369 billion). These were partly offset by a reduction in direct investment in debt instruments, from both euro area residents (from €209 billion to €70 billion) and non-euro area residents (from €151 billion to €39 billion).

According to the monetary presentation of the balance of payments, the net external assets of euro area MFIs decreased by €134 billion in the 12 months to June 2016 owing to transactions, compared with an increase of €34 billion in the 12 months to June 2015. This reflected an increase in the surplus in the current and capital account balance (from €279 billion to €363 billion), which was more than offset by other items and in particular developments in the portfolio investment liabilities of non-MFI euro area residents. This was due to a shift from net acquisitions by non-euro area residents of debt securities issued by non-MFI euro area residents (€32 billion) to net disposals (€166 billion) and a reduction in the net purchases by non-euro area residents of euro area equity securities (from €213 billion to €74 billion).

In June 2016 the Eurosystem’s stock of reserve assets increased by €39.1 billion to €721.8 billion (see Table 3). This was mostly explained by positive price and exchange rate revaluations, particularly of monetary gold (€34.8 billion).

Data revisions

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

Additional information

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: 19 September 2016 (reference data up to July 2016);
• Quarterly balance of payments and international investment position: 7 October 2016 (reference data up to the second 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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