Czech current account surprises market with EUR 159mn surplus in July 2013.

By bne IntelliNews September 11, 2013

The Czech current account swung into a surplus of CZK 4.1bn (EUR 159mn) in July 2013 from a revised deficit of CZK 12.8bn the month before, data from the central bank showed. The improvement reflected a significant increase in the services surplus and shrinking income deficit. The reading exceeded market expectations as analysts were forecasting a deficit of CZK 6.53bn, according to a Reuters poll.

The trade surplus shrank by 25.7% on the month to CZK 12.96bn in July, while the surplus on services balance nearly doubled m/m to CZK 10.8bn.

The income account deficit narrowed by 48% m/m to CZK 19.96bn in July. Dividends amounting to CZK 14.3bn were paid out in July, the central bank said.

The surplus on the current transfers account narrowed to CZK 323mn in July from CZK 2.2bn in June. The balance of current transfers included a surplus of CZK 2bn on transfers from the EU budget to the Czech Republic.

On an annual basis, the current account balance also showed a significant improvement in July 2013 as in the same month last year it had a deficit of CZK 13.2bn.

The 12-month rolling deficit stood at CZK 59bn, equalling to 1.7% of full-year GDP forecast, according to IntelliNews calculations.

According to the finance ministry’s July macroeconomic forecast, the current account deficit should narrow to 2.3% of GDP in 2013 from 2.5% in 2012.

CZKmn Jul-13 Jun-13 Jul-12
I Current Account 4,085 -12,842 -13,216
A. Trade balance 12,958 17,429 12,129
B. Balance of services 10,790 5,841 5,086
C. Income balance -19,985 -38,276 -26,848
D. Current transfers 323 2,162 -3,584
II Capital Account 16,268 -5 691
III Financial Account -40,003 17,007 -3,926
Source: Central bank      
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