Balance of payments

2018 Q4

Simultaneously with the publication of the 2018 Q4 balance of payments figures, revised data for the previous quarters of 2017–2018 are being published. The revised data take into account the results of the CNB’s annual survey of foreign direct investment for 2017 and updated figures on exports and imports of goods and services.

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The current account ended 2018 Q4 in a surplus of CZK 11.1 billion. The financial account recorded an outflow of funds (net lending) of CZK 1.9 billion owing to assets rising faster than liabilities. Reserve assets increased by CZK 42.8 billion (adjusted for valuation differences) due to transactions for CNB clients. The current account surplus was 0.3% of GDP (on an annual basis) and the goods and services surplus 6.4% of GDP (on an annual basis). 

The current account

Ratio of Current Account and Goods and Services Balance to GDP
(CZK billions, right-hand scale in %)

Ratio of Current Account and Goods and Services Balance to GDP

The goods and services balance recorded a surplus of CZK 66 billion in Q4. The year-on-year decrease in the surplus of CZK 6.1 billion was due to a drop in the goods surplus of CZK 4.2 billion (higher growth in imports than in exports). The services surplus recorded a year-on-year decline of CZK 1.9 billion due to an increase in imports of professional advisory services and a decline in the travel surplus.

The primary income deficit narrowed by CZK 5 billion year on year to CZK 58.8 billion in Q4. Dividends on direct and portfolio investment paid abroad amounted to CZK 48.5 billion.

Secondary income showed a surplus of CZK 3.9 billion in Q4, up by CZK 7 billion on a year earlier. This was due mainly to an increase in net income from the EU budget recorded under secondary income.   

The capital account

The capital account ended Q4 in a surplus of CZK 9.7 billion. The year-on-year decline in the surplus of CZK 17.5 billion was due to a decrease in net revenue from the EU budget recorded on the capital account and higher purchases of emission permits from abroad.

The financial account

The financial account (including the change in the CNB’s reserve assets) recorded a net outflow (net lending) of CZK 1.9 billion owing to external assets rising faster than external liabilities. 

Ratio of Financial Account to GDP
(CZK billions, right-hand scale in %)

Ratio of Financial Account to GDP

Direct investment recorded a net inflow of CZK 35.5 billion. This was due mainly to reinvestment of earnings by foreign owners in domestic firms and to loans drawn from affiliated corporations. 

Portfolio investment saw a net inflow (net borrowing) of CZK 22 billion. On the asset side, domestic investors reduced their holdings of foreign securities by CZK 15.4 billion. An increase in liability-side investment of CZK 6.6 billion was a result of purchases of domestic bank and corporate bonds by foreign investors.  

Derivatives trading recorded an inflow of CZK 10.2 billion.

Other investment saw an outflow (net lending) of CZK 26.8 billion.

The banking sector recorded a change in the short-term position of banks as a result of a decrease in short-term liabilities. The net outflow including the CNB (excluding reserve assets) was CZK 42.9 billion.The short-term position of banks was affected on the liability side in particular by optimisation of banks’ balance sheet structures at the end of the year after new regulatory requirements came into force (the Resolution Fund). 

The government sector made repayments of loans drawn in the past and recorded a net outflow of CZK 13.4 billion.

The other sectors saw a net inflow of CZK 29.5 billion.

A surplus on transactions for CNB clients resulted in an increase in reserve assets of CZK 42.8 billion (adjusted for valuation differences).