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Euro zone current account deficit widens again on large energy bill
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FRANKFURT (Reuters) – The euro zone’s current account deficit widened further in May as the bloc’s import bill continued to rise on soaring energy costs, European Central Bank data showed on Wednesday.
The 19-country currency bloc has run a large current account surplus for the past decade thanks to massive exports of goods and services but its fortunes have turned around since Russia’s war in Ukraine pushed up its import bill for raw materials from natural gas to metals.
The adjusted current account deficit widened to 4.49 billion euros in May from 3.91 billion euros in April. A year earlier, the bloc’s surplus was 27 billion euros.
In the 12 months to May, the current account surplus narrowed to 1.1% of GDP from 3.0% in the preceding year.
(Reporting by Balazs Koranyi; Editing by Francesco Canepa)
A current account deficit occurs when a country's total imports of goods, services, and transfers exceed its total exports. It indicates that the country is spending more on foreign trade than it is earning.
Energy costs refer to the expenses incurred for the consumption of energy sources such as electricity, gas, and oil. These costs can significantly impact the overall economic performance of a country.
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