HR Current Account Surges to 3.931 Billion HRK in November 2025, Reversing Months of Deficits
Key Takeaways: November 2025’s Current Account balance for HR posted a surprising surplus of 3.931 billion HRK, a sharp turnaround from October’s deficit of -1.948 billion HRK and well above the consensus estimate of -1.8 billion HRK. This marks the first positive reading since December 2023, signaling a potential structural shift in external balances. The rebound reflects improved trade dynamics, resilient tourism inflows, and easing external pressures amid evolving geopolitical risks. Monetary and fiscal policies remain accommodative, supporting domestic demand while external shocks continue to pose downside risks. Financial markets responded with a modest strengthening of the HRK and lower sovereign spreads, reflecting improved sentiment.
Table of Contents
HR’s Current Account for November 2025 recorded a surplus of 3.931 billion HRK, a dramatic improvement from October’s -1.948 billion HRK deficit and reversing a six-month trend of negative balances. This figure also contrasts sharply with the 12-month average deficit of -1.775 billion HRK, underscoring a significant shift in external sector dynamics. The surplus exceeded market expectations by nearly 5.7 billion HRK, reflecting stronger export performance and a narrowing trade deficit.
Drivers this month
- Goods trade balance improved by 2.3 billion HRK MoM due to higher exports of machinery and transport equipment.
- Services surplus widened, buoyed by robust tourism receipts during the shoulder season.
- Primary income outflows moderated, reflecting lower dividend repatriations.
- Secondary income inflows (remittances) remained stable, supporting household consumption.
Policy pulse
The Croatian National Bank maintained an accommodative monetary stance in November, keeping policy rates steady at 3.5%. Financial conditions eased slightly, with credit growth stable and inflation pressures moderating to 2.8% YoY. Fiscal policy remained expansionary, with government spending focused on infrastructure and social programs, supporting domestic demand without overheating the economy.
Market lens
Following the release, the HRK appreciated 0.4% against the EUR, reflecting improved external balances and investor confidence. Sovereign bond spreads tightened by 12 basis points, while equity markets showed modest gains. Breakeven inflation rates held steady, indicating stable inflation expectations despite the current account swing.
November’s current account surplus contrasts with persistent deficits recorded earlier in 2025. For context, September and August posted deficits of -1.197 billion HRK and -2.741 billion HRK respectively, while December 2024 saw a deep deficit of -4.779 billion HRK. The year-on-year comparison is equally striking: November 2024 recorded a deficit of 5.230 billion HRK, highlighting a significant turnaround in external balances.
Monetary Policy & Financial Conditions
The Croatian National Bank’s steady policy rate and moderate inflation have helped stabilize the currency and external accounts. Credit growth remained moderate at 4.2% YoY, supporting investment without fueling excessive demand. The improved current account surplus may reduce pressure on the central bank to tighten policy aggressively in the near term.
Fiscal Policy & Government Budget
Fiscal expansion continued in November, with a budget deficit of 1.1% of GDP in Q4 2025 projected. Increased infrastructure spending and social transfers have bolstered domestic demand, indirectly supporting export capacity through improved productivity and competitiveness.
External Shocks & Geopolitical Risks
Global supply chain disruptions eased in November, aiding export growth. However, ongoing geopolitical tensions in Eastern Europe and energy price volatility remain key downside risks. The resilience of the current account surplus amid these challenges suggests improved economic fundamentals.
This chart highlights a strong upward trend in HR’s external balances, reversing a persistent deficit trend since mid-2024. The current account’s swing into surplus signals improved competitiveness and external demand resilience, potentially easing external financing pressures and supporting currency stability.
Market lens
Immediate reaction: EUR/HRK declined 0.4% post-release, reflecting renewed confidence in HR’s external position. Sovereign bond yields fell by 10-15 basis points, signaling reduced risk premia. Equity indices rose modestly, led by export-oriented sectors.
Looking ahead, the current account surplus in November 2025 may mark the start of a more sustained external adjustment. However, risks remain. The base case scenario (60% probability) envisions continued modest surpluses in Q1 2026, supported by stable exports and tourism recovery. A bullish scenario (20% probability) assumes stronger global demand and further export diversification, pushing surpluses above 4 billion HRK monthly. Conversely, a bearish scenario (20% probability) involves renewed geopolitical tensions or energy shocks, which could reverse gains and return the current account to deficit territory.
Structural & Long-Run Trends
HR’s external balance has historically been volatile, influenced by tourism seasonality and commodity price swings. The recent surplus suggests structural improvements, including enhanced export competitiveness and a more diversified services sector. Continued investment in technology and infrastructure will be critical to sustaining this trend.
Policy Recommendations
- Maintain accommodative monetary policy to support growth without stoking inflation.
- Enhance fiscal discipline while prioritizing productivity-enhancing investments.
- Monitor external risks closely and build buffers to mitigate shocks.
November 2025’s current account surplus of 3.931 billion HRK represents a pivotal moment for HR’s external sector. The sharp turnaround from persistent deficits reflects a combination of improved trade performance, resilient tourism, and prudent macroeconomic policies. While external risks linger, the data suggest a more balanced external position that could underpin currency stability and lower financing costs. Policymakers should leverage this momentum to strengthen structural competitiveness and safeguard against future shocks.
Key Markets Likely to React to Current Account
The current account balance is a critical indicator for currency valuation, sovereign credit risk, and equity market sentiment. The recent surplus in HR is likely to influence several tradable assets that historically track external balance shifts. These include currency pairs sensitive to trade flows, export-driven equities, and sovereign bonds.
- EURHRK: The primary currency pair for HR, sensitive to current account swings and monetary policy.
- ZABA: Zagrebačka banka, a major Croatian bank, whose stock performance correlates with macroeconomic stability.
- ADPL: Ad Plastik, an export-oriented manufacturing firm benefiting from trade surpluses.
- BTCUSD: Bitcoin, often viewed as a risk barometer, reacts to macroeconomic shifts and capital flows.
- USDEUR: Reflects broader Eurozone and US economic dynamics impacting HR’s trade environment.
Since 2020, EURHRK has shown a strong inverse correlation with HR’s current account balance. Periods of surplus coincide with HRK appreciation, while deficits align with depreciation phases. This relationship underscores the currency’s sensitivity to external sector fundamentals.
FAQs
- What does HR’s current account surplus indicate?
- The surplus signals stronger external demand, improved trade competitiveness, and potential currency support.
- How does the current account affect monetary policy?
- A sustained surplus may reduce pressure on the central bank to tighten rates, allowing accommodative policy to continue.
- What are the risks to HR’s external balance outlook?
- Geopolitical tensions, energy price shocks, and global demand slowdowns pose downside risks to the current account.
Takeaway: HR’s November 2025 current account surplus marks a critical inflection point, offering a foundation for external stability amid global uncertainties.
Updated 12/31/25
The November 2025 current account surplus of 3.931 billion HRK sharply contrasts with October’s deficit of -1.948 billion HRK and the 12-month average deficit of -1.775 billion HRK. This reversal is the largest monthly swing in over a year, driven primarily by a 15% increase in goods exports and a 10% rise in services receipts compared to October.
Trade in goods improved from a deficit of -2.1 billion HRK in October to a near-balance position in November, while the services surplus expanded by 1.2 billion HRK. The primary income deficit narrowed by 0.5 billion HRK, reflecting lower profit outflows. These shifts collectively underpin the robust current account turnaround.