Current accounts and financial flows in the euro area

Alexandr Hobza and Stefan Zeugner

Web appendix and data for
Hobza and Zeugner (2014): Current accounts and financial flows in the euro area, Journal of International Money and Finance

Abstract
We construct a new database of bilateral financial flows among euro area countries and their major world partners and explore the role of financial links in the accumulation and then adjustment of current account imbalances in the euro area. The data show that the geography of financial flows can differ quite markedly from trade flow patterns and suggest that the nexus between surpluses in the 'core' with deficits in the periphery went along financial rather than trade interlinkages. In particular, the data document the dominant role of 'core' countries in financing the euro area periphery's current account deficits before the financial crisis, both directly and through intermediating financial flows from outside of the euro area. Most of this financing took the form of debt instruments. Following the withdrawal of private financing from 'core' countries during the crisis, the ECB-mediated funding and other official flows helped the periphery to refinance its liabilities and smoothen the external adjustment.

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Web appendix

The Web Appendix describes the various challenges in building the database.

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Data

• Financial flows: The file financial_flows.csv holds the estimated bilateral financial account, i.e. gross financial flows from a reporting country to a partner country (i.e. the gross financial asset acquisition of the reporting country in the partner country). It holds data for 62 countries (see web appendix for a description), as well as several flows by asset type (see below).
• Financial stocks: The file financial_stocks.csv holds the estimated bilateral IIP, i.e. the gross financial assets held by a reporting country in a partner country (in other words the gross financial liabilities of the partner country towards the reporting country). It holds data for 85 countries (see web appendix for a description), as well as several stocks by asset type (see below).

Asset types

Code	Description
FDI	Direct investment
PIEQUITY	Portfolio equity
PIDEBT	Portfolio debt (not disclosed for stocks)
SMP_ECB	ECB Securities market programme (part of PIDEBT)
OTHINV	Other investment (not disclosed for stocks)
TARGET_ECB	TARGET2 flows (part of OTHINV)
PROGRAMME	euro area bailout flows (part (of OTHINV)
EQUITY	FDI + PIEQUITY
DEBT	PIDEBT+OTHINV
OFFICIAL	TARGET_ECB+SMP_ECB+PROGRAMME (part of DEBT)
VALUE	FDI + PIEQUITY + PIDEBT + OTHINV

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License

The web appendix falls under the standard license of the Journal of International Money and Finance.

The financial flow data published on this website falls under the Creative Commons ShareAlike 4.0 International license. (I.e. you may share and adapt the data, under the following conditions: that you give appropriate credit, indicate if changes were made, and release remixes of the data under the same license).

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Country codes