Acutal (Aug): CZK -33.7bn
Consensus: CZK -15.0bn
Previous (Jul): CZK -12.8bn
The current account gap came out much larger than expected. One of the reasons behind is the disappointing trade balance that posted a deficit in August (CZK -4.2bn). However, the trade balance data were already out before the C/A release (although in a different methodology). The balance of services remains stable, showing a CZK 5.5bn surplus.
As usual, dividend outflow stand behind a great part of the C/A gap. In August, 39bn korunas flowed out on dividends, which is a big number. The income balance was pushed CZK 36bn into red by the dividends. Currently, foreign investors withdraw three quarters of profits, while only one quarter is reinvested in the Czech economy. We see this as one of results of the worsening economic outlook.
On the financial account, balance of FDIs was very similar to last month (CZK -4.1bn). There was a CZK 8.2bn outflow on the portfolio investment balance due to both trades with equities and bonds.