Euro area balance of payments in July 2012

In July 2012 the seasonally adjusted current account of the euro area recorded a surplus of €9.7 billion. In the financial account, combined direct and portfolio investment recorded net inflows of €18 billion (non-seasonally adjusted).

Current account

The seasonally adjusted current account of the euro area recorded a surplus of €9.7 billion in July 2012 (see Table 1). This reflected surpluses for goods (€7.5 billion), services (€6.2 billion) and income (€1.7 billion), which were partly offset by a deficit for current transfers (€5.8 billion).

The seasonally adjusted 12-month cumulated current account recorded a surplus of €62.9 billion in July 2012 (around 0.7% of euro area GDP – see Table 1 and Chart 1), compared with a deficit of €22.2 billion a year earlier (around 0.2% of euro area GDP). This change resulted from a shift for goods from deficit (€2.4 billion) to surplus (€55.8 billion) and increases in the surpluses for services (from €53.8 billion to €76.7 billion) and income (from €27.5 billion to €34.1 billion), which were partly counterbalanced by an increase in the deficit for current transfers (from €101.1 billion to €103.7 billion).

Financial account

In the financial account (see Table 2), combined direct and portfolio investment recorded net inflows of €18 billion in July 2012, as a result of net inflows for portfolio investment (€24 billion) that were partly offset by net outflows for direct investment (€7 billion).

The net outflows for direct investment resulted from net outflows both in other capital (mostly inter-company loans) (€4 billion) and in equity capital and reinvested earnings (€3 billion).

The net inflows for portfolio investment resulted from net inflows in debt instruments (€30 billion) that were partly counterbalanced by net outflows in equity (€5 billion). The developments for debt instruments resulted mainly from net purchases of euro area money market instruments by non-residents (€18 billion) and from net sales of foreign money market instruments by euro area residents (€9 billion).

The financial derivatives account recorded net outflows of €2 billion.

Other investment recorded net outflows of €22 billion, reflecting mainly net outflows for MFIs excluding the Eurosystem (€47 billion), which were partly offset by net inflows for the Eurosystem (€23 billion).

The Eurosystem’s stock of reserve assets increased by €24 billion in July 2012 (from €701 billion to €725 billion), mainly on account of an increase in the market price of gold. Transactions in July 2012 contributed to a decrease of €1 billion in the overall position.

In the 12-month period to July 2012 combined direct and portfolio investment recorded cumulated net outflows of €9 billion, compared with net inflows of €218 billion in the preceding 12-month period. This shift was largely the result of lower net inflows for portfolio investment (down from €320 billion to €79 billion), which in turn reflected a shift for debt instruments from net inflows (€179 billion) to net outflows (€62 billion).

Data revisions

This press release incorporates revisions to the data for June 2012. These revisions have not significantly altered the figures previously published for the current and capital accounts. The financial account was revised mainly on account of revisions to net outflows in direct investment (from €31 billion to €20 billion) and to net inflows in portfolio investment (from €60 billion to €49 billion).

Additional information on the euro area balance of payments and international investment position

In this press release, the seasonally adjusted current account refers to working day and seasonally adjusted data. Data for the financial account are not working day or seasonally adjusted.

In line with the agreed allocation of responsibilities, the European Central Bank compiles and disseminates monthly and quarterly balance of payments statistics for the euro area, whereas the European Commission (Eurostat; see news releases for “Euro-indicators”) focuses on quarterly and annual aggregates for the European Union. These data comply with international standards, particularly those set out in the IMF’s Balance of Payments Manual (fifth edition). The aggregates for the euro area and the European Union are compiled consistently on the basis of transactions and positions vis-à-vis residents of countries outside the euro area and the European Union respectively.

A complete set of updated euro area balance of payments statistics (including a quarterly geographical breakdown for the main counterparts) and international investment position statistics is available in the “Statistics” section of the ECB’s website under the headings “Data services”/“Latest monetary, financial markets and balance of payments statistics”. These data, as well as historical euro area balance of payments time series, can be downloaded from the ECB’s Statistical Data Warehouse (SDW). Data up to July 2012 will also be published in the October 2012 issues of the ECB’s Monthly Bulletin and Statistics Pocket Book. Detailed methodological notes are available on the ECB’s website. The next press release on the euro area monthly balance of payments will be published on 19 October 2012, together with the quarterly international investment position.

Annexes

Table 1: Current account of the euro area

Table 2: Monthly balance of payments of the euro area