Germany’s net international investment position (i.i.p.) fell by €77.5 billion in the second quarter of 2025.

Other adjustments and the current account balance, including investment income, led to surpluses in the income account. Valuation effects, on the other hand, generated strong deficits, while the effects of financial derivatives showed moderate deficits.

On balance, the instrument account displayed outflows from portfolio investment and direct investment as well as lower outflows from foreign reserve assets. By contrast, financial derivatives recorded only a negligible decline. Other investment saw a slight net increase, caused by transaction-related increases that exceeded negative non-transaction-related changes. Very high negative exchange rate effects led to negative valuation effects overall for portfolio investment, direct investment, other investment and reserve assets. Foreign reserve assets also recorded negative market price effects as a result of developments in the price of gold in euro. In the case of financial derivatives, negative valuation effects were observed, which could not be offset by transaction growth.

In the sector account, non-financial corporations, households and non-profit institutions serving households recorded the largest decline, followed by the Deutsche Bundesbank and general government. By contrast, financial corporations, excluding monetary financial institutions (MFIs) and monetary financial institutions recorded growth.

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.