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•  Major items of the German balance of payments

Sharp decrease in current account surplus

In April 2023, Germany’s current account recorded a surplus of €21.8 billion, down €8.7 billion on the previous month’s level. This was mainly attributable to a smaller goods account surplus. The surplus in invisible current transactions, which comprise services as well as primary and secondary income, remained practically unchanged.

In April, the surplus in the goods account fell by €8.9 billion to €16.1 billion because receipts recorded a sharper decline than expenditure.

At €5.6 billion, the surplus in invisible current transactions remained at roughly the same level as the previous month. The deficit in secondary income declined by €2.6 billion to €5.4 billion in April; this was mainly due to the countermovement to the Bundesbank's net monetary income transfer to the Eurosystem pool in March. However, net receipts in primary income narrowed by almost the same amount (€2.3 billion) to €14.3 billion. The decline was driven in particular by higher dividend payments to non-residents for portfolio investment. In addition, the deficit in the services account was somewhat larger at €3.2 billion. Here, total revenue fell slightly more sharply than expenditure, with a decrease in transactions in the area of other business-related services putting considerable downward pressure on both sides of the balance sheet.

Portfolio investment sees net capital exports

In April, the uncertainty that had temporarily built up in the financial markets as a result of the US banking crisis receded to a large extent. Germany’s cross-border portfolio investment recorded net capital exports of €23.2 billion (after net capital imports of €20.4 billion in March). Resident investors increased their holdings of foreign securities by €17.8 billion. They purchased mainly debt securities (€12.7 billion), of which €7.8 billion was channelled into bonds and €4.9 billion into money market paper. In addition, they purchased mutual fund shares (€3.0 billion) and shares (€2.1 billion) from abroad. Foreign investors sold German securities (€5.5 billion), mainly parting with money market paper (€3.8 billion) on balance. However, they also offloaded shares (€1.4 billion) and bonds (€0.3 billion).

In April, transactions in financial derivatives registered outflows of €5.3 billion (March: outflows of €2.7 billion). 

Direct investment recorded net capital exports of €8.3 billion in April, compared with €14.9 billion in March. German enterprises increased their foreign direct investment stocks by €9.5 billion. They provided affiliated enterprises with additional equity capital (€9.3 billion), largely through reinvested earnings. They also granted a small volume of additional intra-group loans (€0.1 billion), with the increase in trade credits and the decrease in financial loans striking a more or less even balance. Foreign enterprises boosted their direct investment by €1.2 billion, augmenting German enterprises’ equity capital by €2.2 billion. However, they reduced the volume of credit to business units in Germany by €1.0 billion. While they expanded financial loans on balance, the volume of trade credits they granted declined.

Other statistically recorded investment – which comprises loans and trade credits (where these do not constitute direct investment), bank deposits and other investments – registered net capital imports amounting to €40.7 billion in April (following net capital exports of €57.1 billion in March). The net external claims of monetary financial institutions excluding the Bundesbank declined by €10.5 billion, while those of the Bundesbank dropped by €24.2 billion. TARGET claims on the ECB fell by €89.3 billion; the Bundesbank’s external liabilities – mainly vis-à-vis non-euro area residents – also decreased at the same time. General government as well as enterprises and households also recorded net capital imports (€3.3 billion and €2.7 billion, respectively).

The Bundesbank’s reserve assets rose – at transaction values – by €0.1 billion in April.