Euro area monthly balance of payments: March 2021

Current account recorded €18 billion surplus in March 2021, down from €26 billion in previous month
Current account surplus amounted to €267 billion (2.4% of euro area GDP) in 12 months to March 2021, up from €247 billion (2.1%) one year earlier
In financial account, euro area residents’ net acquisitions of foreign portfolio investment securities totalled €1.1 trillion and non-residents’ net acquisitions of euro area portfolio investment securities totalled €123 billion in 12 months to March 2021

The current account of the euro area recorded a surplus of €18 billion in March 2021, a decrease of €8 billion from the previous month (see Chart 1 and Table 1). Surpluses were recorded for goods (€24 billion) and services (€8 billion). These were partly offset by deficits for secondary income (€12 billion) and primary income (€2 billion).

Dataforthecurrentaccountoftheeuroarea

In the 12 months to March 2021, the current account recorded a surplus of €267 billion (2.4% of euro area GDP), compared with a surplus of €247 billion (2.1% of euro area GDP) in the 12 months to March 2020. This increase reflected a larger surplus in services (up from €20 billion to €75 billion) and, to a lesser extent, a larger surplus in goods (up from €334 billion to €344 billion). These developments were partly offset by a reduction in the surplus for primary income (down from €42 billion to €18 billion) and a larger deficit for secondary income (up from €149 billion to €169 billion).

In direct investment, euro area residents made net investments of €13 billion in non-euro area assets in the 12-month period to March 2021, following net disinvestments of €95 billion in the 12 months to March 2020 (see Chart 2 and Table 2). Non-residents’ net investments in euro area assets increased to €212 billion in the 12-month period to March 2021, up from €46 billion in the 12 months to March 2020.

In portfolio investment, net purchases of foreign debt securities by euro area residents increased to €614 billion in the 12-month period to March 2021, following net purchases of €203 billion in the 12 months to March 2020. Over the same period, euro area residents’ net purchases of foreign equity increased to €488 billion from €24 billion in the 12 months to March 2020. Non-residents made net sales of euro area debt securities amounting to €140 billion in the 12 months to March 2021, following net purchases of €231 billion in the 12 months to March 2020. Over the same period, non-residents’ net purchases of euro area equity increased to €263 billion from €172 billion in the 12 months to March 2020.

Dataforthefinancialaccountoftheeuroarea

In other investment, euro area residents recorded net disposals of foreign assets amounting to €340 billion in the 12 months to March 2021 (following net acquisitions of €781 billion in the 12 months to March 2020), while their net incurrence of liabilities decreased to €103 billion from €354 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 €32 billion in the 12-month period to March 2021. This decrease was driven by euro area non-MFIs’ net outflows in portfolio investment debt securities and, to a lesser extent, by their net outflows in portfolio investment equity. These developments were partly offset bythe current and capital accounts surplusand, to a lesser extent, by euro area non-MFIs’ net inflows in direct investment, other investment and other flows.

In March 2021 the Eurosystem’s stock of reserve assets increased slightly to €849.5 billion, from €848.6 billion in the previous month (see Table 3). This increase was mainly driven by positive exchange rate changes (€7.9 billion), which were partly offset by negative price changes (€6.4 billion) and, to a lesser extent, by net disposals of assets (€0.5 billion).