Euro area monthly balance of payments: February 2021

Europe
  • Current account recorded €26 billion surplus in February 2021, down from €35 billion in previous month
  • Current account surplus amounted to €259 billion (2.3% of euro area GDP) in 12 months to February 2021, down from €263 billion (2.2%) one year earlier
  • In financial account, euro area residents’ net acquisitions of foreign portfolio investment securities totalled €804 billion and non-residents’ net sales of euro area portfolio investment securities totalled €21 billion in 12 months to February 2021

The current account of the euro area recorded a surplus of €26 billion in February 2021, decreasing by €9 billion from the previous month (see Chart 1 and Table 1). Surpluses were recorded for goods (€32 billion) and services (€11 billion). These were partly offset by deficits for secondary income (€16 billion) and primary income (€2 billion).

Dataforthecurrentaccountoftheeuroarea

In the 12 months to February 2021, the current account recorded a surplus of €259 billion (2.3% of euro area GDP), compared with a surplus of €263 billion (2.2% of euro area GDP) in the 12 months to February 2020. This decline was driven by a reduction in the surplus for primary income (down from €48 billion to €18 billion) and an increase in the deficit for secondary income (up from €151 billion to €167 billion). These developments were partly offset by larger surpluses for services (up from €36 billion to €58 billion) and for goods (up from €330 billion to €350 billion).

In direct investment, euro area residents made net disinvestments of €16 billion in non-euro area assets in the 12-month period to February 2021, compared with net disinvestments of €10 billion in the 12 months to February 2020 (see Chart 2 and Table 2). Non-residents’ net investments in euro area assets increased to €168 billion in the 12-month period to February 2021, up from €107 billion in the 12 months to February 2020.

In portfolio investment, net purchases of foreign debt securities by euro area residents increased to €443 billion in the 12-month period to February 2021, following net purchases of €390 billion in the 12 months to February 2020. Over the same period, euro area residents’ net purchases of foreign equity increased to €361 billion from €81 billion in the 12 months to February 2020. Non-residents made net disposals of euro area debt securities amounting to €119 billion in the 12 months to February 2021, following net purchases of €230 billion in the 12 months to February 2020. Over the same period, non-residents’ net purchases of euro area equity decreased to €97 billion from €344 billion in the 12 months to February 2020.

Dataforthefinancialaccountoftheeuroarea

In other investment, euro area residents recorded net disposals of foreign assets amounting to €63 billion in the 12 months to February 2021 (following net purchases of €549 billion in the 12 months to February 2020), while their net incurrence of liabilities increased to €255 billion from €187 billion.

The monetary presentation of the balance of payments (see Chart 3) shows that the net external assets (enhanced) of euro area MFIs decreased by €78 billion in the 12-month period to February 2021. This decrease was mainly driven by euro area non-MFIs’ net outflows in portfolio investment equity and portfolio investment debt. These developments were partly offset by the current and capital accounts surplusand, to a lesser extent, euro area non-MFIs’ net inflows in direct investment and other flows.

In February 2021 the Eurosystem’s stock of reserve assets decreased to €848.6 billion, down from €880.2 billion in the previous month (see Table 3). This decrease was driven by negative changes in the price of gold (€29.4 billion) and to a lesser extent by net disposals of assets (€1.6 billion).

Dataforthereserveassetsoftheeuroarea

 

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