Balance of payments – commentary
2025 Q3
Simultaneously with the publication of the 2025 Q3 balance of payments figures, revised data for 2025 Q2 are being published.
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The current account ended 2025 Q3 in a deficit of CZK 14.0 billion. The financial account recorded a net outflow of funds (net lending) of CZK 50.1 billion owing to higher transaction growth in external assets than external liabilities. The CNB’s reserve assets rose by CZK 127.8 billion (adjusted for valuation and price differences).
The result of the transactions was a current account surplus of 0.7% of GDP on an annual basis. The goods and services surplus was 5.7% of GDP.
Current account
Ratio of Current Account and Goods and Services Balance to GDP
(CZK billions, right-hand scale in %)
Note: Indicators calculated on the basis of annual moving aggregates
The goods and services balance recorded a surplus of CZK 97.8 billion in Q3. The balance fell by CZK 0.5 billion year on year at current prices. The goods balance ended in a surplus of CZK 76.3 billion, an improvement of CZK 3.4 billion on a year earlier. The services balance also showed a surplus (CZK 21.5 billion), representing a year-on-year decrease in the surplus of CZK 4 billion. The year-on-year decline in the services surplus was due mainly to an annual decrease in exports of research and development services and an annual increase in imports of transport services. The total goods and services turnover at current prices was up by 1.7% year on year in Q3, amid a rise in exports of CZK 22.5 billion and an increase in imports of CZK 23 billion.
The primary income deficit was CZK 91.5 billion in Q3. The year-on-year decline in the deficit of CZK 5.3 billion was due mainly to a year-on-year increase in reinvested earnings distributed among foreign direct investors. These reinvested earnings amounted to CZK 66.3 billion, representing a year-on-year increase of CZK 20.4 billion.
Secondary income recorded a deficit of CZK 20.3 billion in Q3 (a deterioration of CZK 6.4 billion on a year earlier). The year-on-year increase in the deficit was due mainly to a decrease in the surplus on net income from the EU budget recorded in the secondary income balance.
The capital account
The capital account ended Q3 in a surplus of CZK 79.4 billion. The year-on-year rise in the surplus of CZK 56.3 billion was due to higher income from the EU budget recorded on the capital account.
The financial account
The financial account (including the change in the CNB’s reserve assets) recorded a net outflow (net lending) of CZK 50.1 billion in Q3 owing to external liabilities increasing more markedly than external assets.
Ratio of Financial Account to GDP
(CZK billions, right-hand scale in %)
Note: Indicators calculated on the basis of annual moving aggregates
Foreign direct investment saw a net inflow of funds totalling CZK 5.4 billion. The main factors on the asset side were an increase in the share of reinvested earnings by domestic owners in foreign subsidiaries and an increase in domestic loans provided to foreign companies. Liabilities transactions included a rise in the share of foreign owners in the reinvested earnings of domestic companies. Conversely, the share of foreign parent companies in the equity capital of domestic companies decreased.
Portfolio investment recorded a net inflow of CZK 37 million. On the asset side, this was due mainly to purchases of foreign debt securities (CZK 42.5 billion), investment fund units (CZK 38.3 billion) and equities (CZK 17 billion) by residents. Purchases of domestic debt securities (CZK 84.2 billion) and investment fund units (CZK 13.5 billion) by non-residents were recorded on the liabilities side.
Derivatives trading recorded a net outflow of funds totalling CZK 1.1 billion.
Other investment saw an inflow (net borrowing) of CZK 73.3 billion. This was due mainly to a net inflow of CZK 117.8 billion within deposits, while a net outflow within other accounts receivable/payable and loans (CZK 22 billion and CZK 19.4 billion respectively) acted in the opposite direction.
The foreign exchange position of the banking sector (including the CNB) saw a net inflow of CZK 82.4 billion.
The position of other sectors within other investments recorded a net outflow of CZK 9 billion, due mainly to net lending abroad by residents (CZK 12.6 billion), while a reduction in foreign deposits by residents lowered the net outflow (CZK 7.8 billion).
The CNB’s own transactions and transactions for CNB clients resulted in an increase in reserve assets of CZK 127.8 billion (adjusted for valuation differences).