German Bundesbank reports Germany’s May 2025 current account surplus fell to EUR 9.6bn

The German Bundesbank published Germany’s balance of payments for May 2025, showing the current account surplus fell to EUR 9.6bn, almost halving from the previous month. The contraction was driven mainly by a swing in the balance on “invisible” current transactions into deficit, alongside a slightly smaller goods trade surplus. The goods trade surplus declined by EUR 0.9bn to EUR 14.5bn as export receipts fell more than import expenditures, with noticeably weaker exports to the United States following earlier frontloading ahead of US tariff announcements. The surplus on “invisible” transactions shifted from EUR 3.5bn to a EUR 4.9bn deficit, reflecting a EUR 11.7bn fall in net primary income to EUR 2.7bn due to higher dividend payments to non-residents. The secondary income deficit narrowed by EUR 2.2bn to EUR 2.4bn, while the services deficit narrowed by EUR 1.1bn to EUR 5.2bn as expenditures declined more than receipts, including lower spending on other business-related services. Net capital exports increased to EUR 29.1bn (from EUR 18.6bn). Direct investment recorded net capital imports of EUR 7.2bn, as foreign firms provided EUR 9.4bn to affiliates in Germany largely via intra-group loans, while German firms increased outward direct investment by EUR 2.2bn. Portfolio investment produced net capital exports of EUR 15.6bn, with residents buying EUR 43.5bn of foreign securities and non-residents purchasing EUR 28.0bn of German securities. Financial derivatives generated net outflows of EUR 6.6bn, and other investment recorded net capital exports of EUR 13.5bn; Bundesbank TARGET claims on the ECB fell by EUR 8.4bn and transaction-value foreign reserves rose by EUR 0.6bn.