Euro area monthly balance of payments (May 2017)

• In May 2017 the current account of the euro area recorded a surplus of €30.1 billion.^[1]
• In the financial account, combined direct and portfolio investment recorded net acquisitions of assets of €100 billion and net incurrences of liabilities of €88 billion.

Current account

The current account of the euro area recorded a surplus of €30.1 billion in May 2017 (see Table 1). This reflected surpluses for goods (€26.9 billion), primary income (€11.4 billion) and services (€2.6 billion), which were partly offset by a deficit for secondary income (€10.7 billion).

The 12-month cumulated current account for the period ending in May 2017 recorded a surplus of €348.7 billion (3.2% of euro area GDP), compared with one of €371.0 billion (3.5% of euro area GDP) for the 12 months to May 2016 (see Table 1 and Chart 1). This development was due to decreases in the surpluses for goods (from €364.9 billion to €348.0 billion) and services (from €65.4 billion to €49.1 billion), and an increase in the deficit for secondary income (from €121.4 billion to €142.0 billion). These were partly offset by an increase in the surplus for primary income (from €62.1 billion to €93.6 billion).

Financial account

In May 2017 combined direct and portfolio investment recorded net acquisitions of assets of €100 billion and net incurrences of liabilities of €88 billion (see Table 2).

Euro area residents recorded net acquisitions of €22 billion of direct investment assets as a result of net acquisitions of equity (€17 billion) and debt instruments (€5 billion). Direct investment liabilities also increased, by €18 billion, as a result of net acquisitions of euro area equity and debt instruments by non-euro area residents (€10 and €8 billion, respectively).

With regard to portfolio investment assets, euro area residents made net acquisitions of foreign securities amounting to €78 billion. This resulted from net purchases of equity (€15 billion) and short and long-term debt securities (€22 and €41 billion, respectively). Portfolio investment liabilities increased by €70 billion as a result of non-euro area residents’ net acquisitions of euro area equity (€47 billion) and long-term debt securities (€22 billion).

The euro area net financial derivatives account (assets minus liabilities) recorded positive net flows of €3 billion.

Other investment recorded decreases of €9 billion in assets and €14 billion in liabilities. The decrease in assets is mainly attributable to the MFI sector (excluding the Eurosystem) (€10 billion) and, to a lesser extent, to the Eurosystem (€3 billion), and was partly offset by an increase in other investment assets of other sectors (€6 billion). Conversely, the decrease in liabilities was largely explained by the Eurosystem (€9 billion) and, to a lesser extent, by other sectors (€6 billion).

In the 12 months to May 2017 combined direct and portfolio investment recorded increases of €819 billion in assets and €276 billion in liabilities, compared with increases of €970 billion and €388 billion respectively in the 12 months to May 2016. This resulted primarily from a decrease in the direct investment activity of both euro area residents abroad and non-residents in the euro area, which was partly offset by an increase in portfolio investment.

According to the monetary presentation of the balance of payments, the net external assets of euro area monetary financial institutions (MFIs) decreased by €267 billion in the 12 months to May 2017, compared with a decrease of €121 billion in the 12 months to May 2016. This still reflects a 12-month cumulated current account surplus (€332.1 billion) whose counterpart entries are observed in net financial transactions by non-MFIs. In particular, the cumulated transactions in direct investment liabilities decreased significantly from €486 billion to €140 billion, while transactions in portfolio investment assets switched from net sales/amortisations of euro area non-MFI equities of €1 billion to net purchases of €94 billion.

In May 2017 the Eurosystem’s stock of reserve assets decreased to €699.5 billion from €716.9 billion in the previous month (see Table 3). This decrease (€17.4 billion) is mainly explained by negative price changes and exchange rate developments (€10.8 billion and €6.8 billion, respectively).

Data revisions

This press release incorporates revisions to the data for April 2017. These revisions have not significantly altered the figures previously published.

Additional information

• Time-series data: the ECB’s Statistical Data Warehouse (SDW)
• Methodological information
• Monetary presentation of the balance of payments

Next press releases:

• monthly balance of payments: 18 August 2017 (reference data up to June 2017);
• quarterly balance of payments and international investment position: 4 October 2017 (reference data up to the second quarter of 2017).

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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