Euro area balance of payments (May 2009)

In May 2009 the working day and seasonally adjusted current account of the euro area recorded a deficit of EUR 1.2 billion. In the financial account, combined direct and portfolio investment showed net inflows of EUR 60 billion.

The working day and seasonally adjusted current account of the euro area recorded a deficit of EUR 1.2 billion in May 2009 (corresponding to a deficit of EUR 13.0 billion in non-adjusted terms). This reflected a deficit in current transfers (EUR 7.9 billion), which was partly offset by surpluses in goods (EUR 2.9 billion), services (EUR 2.2 billion) and income (EUR 1.6 billion).

The 12-month cumulated, working day-adjusted current account up to May 2009 recorded a deficit of EUR 125.1 billion (about 1.4% of euro area GDP), compared with a deficit of EUR 21.7 billion a year earlier. This change was due to a shift in the goods account from a surplus (EUR 32.4 billion) to a deficit (EUR 12.5 billion), increases in the deficits in income (from EUR 12.3 billion to EUR 42.8 billion) and current transfers (from EUR 93.8 billion to EUR 101.0 billion), and a decrease in the surplus in services (from EUR 51.9 billion to EUR 31.1 billion).

In the non-seasonally adjusted financial account, combined direct and portfolio investment showed net inflows in May 2009 (EUR 60 billion), both in portfolio investment (EUR 54 billion) and in direct investment (EUR 6 billion).

The net inflows in direct investment resulted from net inflows in other capital (mostly inter-company loans) (EUR 8 billion) , which were partly offset by net outflows in equity capital and reinvested earnings (EUR 2 billion).

Portfolio investment recorded net inflows in both debt instruments (EUR 46 billion) and equity (EUR 8 billion). The developments in debt instruments largely reflected net purchases of euro area bonds and notes by non-residents.

Financial derivatives recorded net inflows of EUR 10 billion.

Other investment recorded net outflows of EUR 43 billion, mainly as a result of net outflows for the Eurosystem (EUR 20 billion) and other sectors (EUR 17 billion).

Reserve assets increased by EUR 2 billion (excluding valuation effects). The stock of the Eurosystem’s reserve assets stood at EUR 423 billion at the end of May 2009.

In the 12-month period to May 2009, combined direct and portfolio investment showed cumulated net inflows of EUR 418 billion, compared with net outflows of EUR 18 billion a year earlier. This shift mainly resulted from a rise in net inflows of portfolio investment (from EUR 130 billion to EUR 594 billion), largely reflecting a shift from net outflows to net inflows in money market instruments. The rise in net inflows of portfolio investment was to a limited extent offset by higher net outflows of direct investment (up from EUR 148 billion to EUR 176 billion).

In addition to the balance of payments for May 2009, this press release incorporates revisions for April 2009. These revisions have not changed significantly the previously published results.

A complete set of updated euro area balance of payments and international investment position statistics is available on the ECB’s website in the “Statistics” section under the headings “Data services”/“Latest monetary, financial markets and balance of payments statistics”. These data, as well as the historical euro area balance of payments time series, can be downloaded from the ECB’s Statistical Data Warehouse (SDW). Data up to May 2009 will also be published in the August 2009 issues of the ECB’s Monthly Bulletin and Statistics Pocket Book. A detailed methodological note is available on the ECB’s website. The next press release on the euro area monthly balance of payments will be published on 19 August 2009.

Table 1: Current account of the euro area – working day and seasonally adjusted data.

Table 2: Monthly balance of payments of the euro area – non-seasonally adjusted data.