The seasonally adjusted current account of the euro area recorded a deficit of EUR 13.1 billion in September 2010. This reflected deficits in current transfers (EUR 11.3 billion) and income (EUR 5.5 billion), which were partly offset by surpluses in goods (EUR 1.8 billion) and services (EUR 1.8 billion).
The 12-month cumulated seasonally adjusted current account recorded a deficit of EUR 46.3 billion in September 2010 (around 0.5% of euro area GDP), compared with a deficit of EUR 91.0 billion a year earlier. The reduction in the current account deficit was due predominantly to a decrease in the income deficit (from EUR 40.4 billion to EUR 12.6 billion) and to an increase in the goods surplus (from EUR 15.0 billion to EUR 33.4 billion).
Financial account
In the financial account, combined direct and portfolio investment recorded net inflows of EUR 7 billion in September 2010, as a result of net inflows in portfolio investment (EUR 17 billion) that were partly offset by net outflows in direct investment (EUR 10 billion).
The net outflows in direct investment were predominantly accounted for by net outflows in equity capital and reinvested earnings (EUR 12 billion).
Portfolio investment recorded net inflows in debt instruments (EUR 27 billion) and net outflows in equity (EUR 11 billion). The net inflows in debt instruments resulted mainly from net purchases of euro area bonds and notes by non-residents (EUR 27 billion).
The financial derivatives account recorded net outflows of EUR 2 billion.
Other investment recorded net inflows of EUR 8 billion, mainly reflecting net inflows by general government (EUR 5 billion) and by other sectors (EUR 2 billion).
The Eurosystem’s stock of reserve assets decreased from EUR 573 billion to EUR 552 billion in September 2010, mainly on account of valuation effects (transactions were balanced).
In the 12-month period to September 2010, combined direct and portfolio investment recorded cumulated net inflows of EUR 73 billion, compared with net inflows of EUR 207 billion in the preceding 12-month period. This decrease was the result of lower net inflows in portfolio investment (down from EUR 367 billion to EUR 160 billion), which were only partly offset by lower net outflows in direct investment (down from EUR 160 billion to EUR 87 billion). The decrease in net inflows in portfolio investment was mainly due to lower net inflows in money market instruments (down from EUR 204 billion to EUR 77 billion).
