Euro-Area Current Account Surplus Widens to €35 Billion in June

The euro area’s current account surplus widened to €35 billion in June 2026 from €26 billion in May, according to the European Central Bank, as surpluses in goods, services and primary income more than offset a deficit in secondary income. The June figure was €9 billion higher than the previous month on a working day and seasonally adjusted basis.

The monthly breakdown showed a goods surplus of €18 billion, a primary-income surplus of €17 billion and a services surplus of €16 billion. Secondary income, which includes transfers that do not involve an exchange of goods or services, recorded a €16 billion deficit. Together, those components produced the €35 billion headline balance after rounding.

In its June balance-of-payments release, the ECB said the current account data incorporate revisions to April and May that did not significantly alter previously published figures. The bank reports current-account data on a seasonally and working day-adjusted basis, while capital and financial-account data are not seasonally or working day adjusted.

June improvement comes against a weaker 12-month comparison

The stronger June reading did not reverse the broader decline in the euro area’s external surplus compared with a year earlier. In the 12 months through June, the current account recorded a surplus of €276 billion, equal to 1.7% of euro-area gross domestic product. That was down from €305 billion, or 2.0% of GDP, in the corresponding 12-month period a year earlier.

The largest drag on that comparison came from goods. The 12-month goods surplus narrowed to €282 billion from €342 billion a year earlier, a reduction of €60 billion. The secondary-income deficit also widened to €202 billion from €176 billion, subtracting a further €26 billion from the overall balance.

Those declines were partly offset by stronger income and services balances. Primary income shifted to a €38 billion surplus from a €10 billion deficit a year earlier, a €48 billion improvement. The services surplus increased to €159 billion from €150 billion.

That mix means the June monthly improvement and the year-on-year 12-month comparison are telling different parts of the same story. June showed a larger surplus than May, but the accumulated external balance over the latest year remained smaller than in the previous 12-month period because the goods surplus has contracted and the secondary-income deficit has increased.

Separate quarterly data released by the ECB in July provide more detail on the earlier stages of that shift. In the four quarters through the first quarter of 2026, the euro-area current account surplus was €275 billion, or 1.7% of GDP, compared with €352 billion, or 2.3% of GDP, a year earlier. The ECB said the lower goods surplus in that period reflected smaller surpluses in chemical products and in machinery and manufactured products, partly offset by a smaller deficit in energy products.

The quarterly figures also showed changes within services. The deficits for charges for the use of intellectual property and for other business services widened, while the surpluses for telecommunications, computer and information services and for travel increased. Those figures cover the four quarters through March and therefore do not describe June directly, but they help show which categories had been shaping the broader external balance before the latest monthly release.

Trade relationships remain uneven across major counterparts

The ECB’s quarterly geographical breakdown also showed that the euro area’s external balance is not evenly distributed across trading partners. In the four quarters through the first quarter of 2026, the largest bilateral current-account surplus was with the United Kingdom at €236 billion, followed by Switzerland at €78 billion.

The largest bilateral deficit was with China at €170 billion. The euro area also recorded an €82 billion deficit with the United States, up sharply from a €3 billion deficit a year earlier in the comparable four-quarter period. At the same time, the goods surplus with the United States fell to €189 billion from €245 billion, while the services deficit with the United States widened to €184 billion from €165 billion.

Those quarterly figures are not a substitute for the June monthly data because the reference periods and adjustment methods differ. They do, however, show that changes in the aggregate current account can reflect large and offsetting movements across countries and across goods, services and income flows. The June release itself does not provide a new geographical breakdown.

The latest monthly data therefore point to an external surplus that improved sequentially in June but remains below its year-earlier level on a 12-month basis. The key gap is in goods, where the rolling surplus is €60 billion smaller than it was a year ago, even as primary income has moved from deficit to surplus.

Portfolio flows show stronger foreign demand for euro-area securities

The ECB also reported large cross-border financial flows over the 12 months through June. Euro-area residents made net acquisitions of €820 billion of non-euro-area portfolio investment securities. Non-residents, meanwhile, made net acquisitions of €1.123 trillion of euro-area portfolio investment securities.

Within those totals, euro-area residents’ net purchases of non-euro-area equity fell to €193 billion from €258 billion a year earlier. Their net purchases of non-euro-area debt securities increased to €627 billion from €604 billion.

Foreign investors increased their purchases of euro-area securities more markedly. Non-residents’ net purchases of euro-area equity rose to €499 billion from €450 billion, while net purchases of euro-area debt securities climbed to €624 billion from €354 billion. The increase in foreign demand for euro-area debt accounted for much of the rise in total non-resident portfolio purchases over the period.

Direct-investment flows also increased in both directions. Euro-area residents made €352 billion of net direct investment in non-euro-area assets in the 12 months through June, up from €173 billion a year earlier. Non-residents made €71 billion of net direct investment in euro-area assets, compared with €24 billion in the earlier period.

In other investment, euro-area residents recorded €753 billion of net acquisitions of non-euro-area assets, up from €623 billion a year earlier. Their net incurrence of liabilities rose to €537 billion from €396 billion. The ECB’s monetary presentation showed that the enhanced net external assets of euro-area monetary financial institutions increased by €270 billion over the 12 months through June.

The release also showed a sharp monthly decline in the Eurosystem’s reserve assets, to €1.755 trillion in June from €1.873 trillion in May. The ECB attributed most of that decline to €123.5 billion of negative price changes, largely reflecting a fall in the price of monetary gold. Net asset sales of €0.8 billion also reduced reserves, while positive exchange-rate changes of €7.1 billion partly offset the decline.

The ECB is scheduled to publish July monthly balance-of-payments data on September 18. Its next quarterly balance-of-payments and international-investment-position release, covering the second quarter of 2026, is scheduled for October 2.