Euro area monthly balance of payments: August 2020

20 October 2020

• Current account recorded €20 billion surplus in August 2020, up from €17 billion in previous month^[1]
• Current account surplus amounted to €224 billion (1.9% of euro area GDP) in 12 months to August 2020, down from €265 billion (2.2%) one year earlier
• In financial account, euro area residents’ net acquisitions of foreign portfolio investment securities totalled €549 billion and non-residents’ net acquisitions of euro area portfolio investment securities totalled €446 billion in 12 months to August 2020

The current account of the euro area recorded a surplus of €20 billion in August 2020, increasing by €3 billion from the previous month (see Chart 1 and Table 1). Surpluses were recorded for goods (€32 billion) and services (€2 billion). Deficits were recorded for secondary income (€11 billion) and primary income (€4 billion).

Data for the current account of the euro area

In the 12 months to August 2020, the current account recorded a surplus of €224 billion (1.9% of euro area GDP), compared with a surplus of €265 billion (2.2% of euro area GDP) in the 12 months to August 2019. This decline was driven by reductions in the surpluses for services (down from €68 billion to €25 billion) and for primary income (down from €67 billion to €24 billion). These developments were partly offset by a larger surplus for goods (up from €294 billion to €323 billion) and a smaller deficit for secondary income (down from €164 billion to €148 billion).

In direct investment, euro area residents made net disinvestments of €18 billion in non-euro area assets in the 12-month period to August 2020, following net disinvestments of €236 billion in the 12 months to August 2019 (see Chart 2 and Table 2). At the same time, non-residents made net investments in euro area assets of €115 billion in the 12-month period to August 2020, following net disinvestments of €182 billion in the 12 months to August 2019.

In portfolio investment, net purchases of foreign debt securities by euro area residents increased to €395 billion in the 12-month period to August 2020, following net purchases of €223 billion in the 12 months to August 2019. Over the same period, euro area residents made net purchases in foreign equity of €154 billion, after recording net sales of €66 billion in the 12 months to August 2019. Non-residents made net purchases of euro area debt securities amounting to €196 billion in the 12 months to August 2020, up from net purchases of €148 billion in the 12 months to August 2019. Over the same period, non-residents’ net purchases of euro area equity rose to €250 billion from €151 billion.

Data for the financial account of the euro area

In other investment, euro area residents’ net acquisitions of foreign assets decreased to €113 billion in the 12 months to August 2020 (following net acquisitions of €503 billion in the 12 months to August 2019), while non-euro area residents recorded net disposals of €36 billion in euro area assets, following net acquisitions of €175 billion.

The monetary presentation of the balance of payments (see Chart 3) shows that the net external assets (enhanced) of euro area MFIs increased by €44 billion in the 12-month period to August 2020. This increase was mainly driven by the current and capital accounts surplus and, to a lesser extent, by euro area non-MFIs’ net inflows in direct investment and portfolio investment debt. These developments were partly offset by euro area non-MFIs’ net outflows in portfolio investment equity and other instruments (particularly other investment).

In August 2020 the Eurosystem’s stock of reserve assets decreased to €915.0 billion, down from €923.1 billion in the previous month (see Table 3). This decrease was driven by negative price changes (€7.9 billion) and to a lesser extent by negative exchange rate changes (€1.6 billion), which were only partly offset by net acquisitions of assets (€1.3 billion).

Data for the reserve assets of the euro area

Data revisions

This press release incorporates revisions to the data for July 2020, which mainly affected portfolio investment.

Next releases:

• Monthly balance of payments: 19 November 2020 (reference data up to September 2020)
• Quarterly balance of payments and international investment position: 11 January 2021 (reference data up to the third quarter of 2020)^[2]

For media queries, please contact Philippe Rispal, tel.: +49 69 1344 5482.

Notes

• Hyperlinks in this press release lead to data that may change with subsequent releases as a result of revisions.