The current account surplus measured 45.7 b.kr. in Q3/2024. This represents an improvement of 84 b.kr. relative to the previous quarter but a deterioration of 40.9 b.kr. relative to Q3/2023. There was a deficit on goods trade in the amount of 76 b.kr and a 140.5 b.kr. surplus on services trade (See the Statistics Iceland webpage). The deficit on primary income amounted to 6.6 b.kr. and the deficit on secondary income 12.2 b.kr. (Table 1).
This is included in new information published on the Central Bank of Iceland website, showing the preliminary balance of payments in Q3/2024 and the external position of the economy at the end of the quarter.
Table 1: Balance of payments (b.kr.)
| 2024/3 | 2024/2 | 2024/1 | 2023/4 | 2023/3 | |
|---|---|---|---|---|---|
Current account balance | 45.7 | -38.3 | -33.7 | -14.3 | 86.6 |
Balance on goods | -76.0 | -89.2 | -52.3 | -77.8 | -84.4 |
Balance on services | 140.5 | 67.4 | 17.6 | 37.3 | 155.0 |
Balance on primary income | -6.6 | -2.1 | 12.3 | 39.2 | 28.6 |
Secondary income, net | -12.2 | -14.4 | -11.3 | -13.0 | -12.5 |
Capital account | -0.4 | -1.4 | -0.8 | -1.4 | -0.7 |
Financial account | 39.2 | -49.5 | 20.2 | -4.4 | 38.3 |
Direct investment | -46.7 | -12.9 | 11.0 | 21.3 | -139.2 |
Portfolio investment | 28.5 | 96.0 | -201.6 | 96.0 | 100.3 |
Derivatives | -2.7 | 1.5 | -0.1 | -3.7 | -6.9 |
Other investments | 69.2 | -112.6 | 91.1 | -122.1 | 90.4 |
International reserves | -9.1 | -21.4 | 119.8 | 4.0 | -6.3 |
Net errors and omissions | -6.1 | -9.9 | 54.7 | 11.2 | -47.7 |
The net international investment position was positive by 1,793 b.kr., or 40.2% of GDP, and improved by 130 b.kr., or 2.9% of GDP, during the quarter. External assets totalled 6,351 b.kr. at the end of the quarter, and external liabilities were 4,558 b.kr. The position improved by 39 b.kr. during the quarter, owing to financial account transactions, as foreign assets increased by 76 b.kr. and foreign liabilities by 37 b.kr. Price and exchange rate movements during the quarter increased asset values by 103 b.kr. and reduced the value of liabilities by 5 b.kr., thereby yielding an improvement of 109 b.kr. in the net external position. The króna depreciated during the quarter by 0.4% in terms of the tradeweighted index. Prices in foreign securities markets rose by 6% between quarters, and domestic stock market rose by 8.9%.
Table 2: Quarter-on-quarter change in international investment position (b.kr.)
| Position at end Q3/2024 | Financial account | Exhange rate and price changes | Other changes | Position at end Q2/2024 | |
|---|---|---|---|---|---|
Foreign assets, total | 6,351 | 76 | 103 | 16 | 6,155 |
Direct investment | 1,035 | -9 | 0 | 8 | 1,036 |
Portfolio investment | 3,682 | 53 | 74 | 0 | 3,556 |
Derivatives* | 15 | -3 | 13 | 0 | 5 |
Other investments | 720 | 45 | -4 | 9 | 670 |
International reserves | 899 | -9 | 21 | 0 | 888 |
Foreign liabilities, total | 4,558 | 37 | -5 | 34 | 4,492 |
Direct investment | 1,749 | 37 | -17 | 17 | 1,711 |
Portfolio investment | 1,540 | 24 | 25 | 0 | 1,491 |
Derivatives* | 9 | 0 | -4 | 0 | 13 |
Other investments | 1,259 | -24 | -9 | 16 | 1,277 |
Net international investment position (NIIP) | 1,793 | 39 | 109 | -17 | 1,663 |
% of GDP | 40.2% | 0.9% | 2.4% | -0.4% | 37.2% |
* Other changes are included under price and exchange rate changes for derivatives.