Germany’s net international investment position (i.i.p.) declined by €51 billion in the first quarter of 2025.

Other adjustments, the current account balance (including investment income) and effects stemming from financial derivatives led to surpluses in the income account. Valuation effects, by contrast, generated sizeable deficits.

On balance, the instrument account showed strong outflows in portfolio investment and a slight decline in direct investment as well as moderate growth in financial derivatives and reserve assets. Other investment saw only a slight net rise, driven by transaction-related increases that exceeded negative non-transaction-related changes. Direct investment saw negative valuation effects, which were not offset by increases in transactions and other adjustments. The decline in portfolio investment was mainly attributable to valuation effects. This was counteracted by positive transactions and other adjustments. In the case of financial derivatives, all components of change showed positive balances. Reserve assets benefited from positive movements in the price of gold, in particular.

In the sector account, non-financial corporations, households and non-profit institutions serving households recorded the largest decrease, followed by monetary financial institutions (MFIs), financial corporations (excluding MFIs) and general government. This contrasted with growth at the Bundesbank.

The three-dimensional account system analyses changes in the net i.i.p. from a range of perspectives: the income account establishes the link to balance of payments transactions and adds to valuation effects and other adjustments, the instrument account shows how changes in the net i.i.p. are reflected in the various functional categories of financial assets, and the sector account considers the domestic sectors involved.