The Current account records all economic transactions between resident and nonresident entities during a given period.
It determines the exposure of an economy to the rest of the world. Current account includes the following components: trade in goods (which covers general merchandise, goods for processing, and others); trade in services (transport services performed by euro zone residents for non- euro zone residents, or vice-versa, movement of goods, and others); income (compensation of employees paid to nonresident workers or received from non-resident employers, and investment income accrued on external financial assets and liabilities); current transfers (includes general government current transfers, payments of current taxes on income and wealth, and other payments). Also, very important is the financial account which explains how the current account is financed.
The balance of payments registers the value of credits (exports) and debits (imports). A negative balance (deficit) shows that a country is spending more than it is earning from transactions with other countries.
Because current account tracks the trade balance (i.e. inflows and outflows) to/from the eurozone, a positive value (surplus) indicates that the capital is flowing to the eurozone. This is a sign of the growing business interest in the euro zone from foreign investors and, strengthens the currency leading to its appreciation.
A negative value (deficit) indicates that there is more capital leaving the euro zone than there is an inflow. This generates a shift of foreign capital from the euro zone, which leads to the depreciation of the currency (weakening).
Periodicity of publication
Eurostat publishes the 1st release of the balance of payments on the first days of the following quarter after the reference quarter.