Balance of payments of Luxembourg during the first quarter of 2018

The Central Bank of Luxembourg (BCL) and STATEC inform that, according to preliminary provisional results, the current account showed a surplus of 607 million euros in the first quarter of 2018, compared to a deficit of 495 million euros in the same period of the previous year.

The trade deficit (general merchandise) increased by 171 million euros and reached down 1.9 billion in the first quarter of 2018. An increase in imports of energy products is largely responsible for this development and more than offset the lack of aircraft imports during the first quarter of 2018. With regard to net exports of goods under merchanting (purchases and sales of goods without these passing through Luxembourg), the significant increase in the first quarter of 2018 is explained by the reclassification of some goods purchases under merchanting to imports of non-financial services. This reclassification also affects previous periods (including the first quarter of 2017), but these will only be revised in September 2018. The balance of international trade in services, and more particularly the non-financial services, dropped by 164 and 290 million euros respectively (in relation with the reclassification previously mentioned). Exports and imports of financial services increased by more than 5%, due in part to the performance of assets managed by investment funds.

In the financial account, direct investment flows were dominated by disinvestment operations for both assets (-72 billion euros) and liabilities (-40 billion euros). These operations concerned a small number of SOPARFIs which ceased their activities. Regarding portfolio investment, non-resident investments in Luxembourg equities (largely Investments Funds shares) remained almost stable, reaching 84 billion euros in the first quarter of 2018, compared to 86 billion euros in the first quarter of 2017. On the other hand, long-term debt securities incurred net sales of 24 billion euros in the first quarter of 2017, compared to net purchases of 15 billion euros in the same quarter of 2017. Securities issued by Luxembourg thus amounted to 62 billion euros in the first quarter of 2018, compared to 107 billion euros in the same quarter of 2017. With regard to foreign securities, residents increased their investments, which totaled 95 billion euros in the first quarter of 2018, of which 44 billion euros in debt securities and 51 billion euros in equity securities. Portfolio investment flows resulted in net outflows of 33 billion euros in the first quarter of 2018, offsetting entirely the net inflows in direct investment flows.

Detailed statistical tables are available on BCL’s website (www.bcl.lu) as well as on the website of STATEC (www.statistiques.lu).

Table: Balance of payments of Luxembourg

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