$665 Million Current Account Deficit in the Palestinian Balance of Payments for Q2 2025

SadaNews – The latest surveys by the Central Bureau of Statistics and the Monetary Authority, whose results were published today, Tuesday, show a continued deficit in the current account of the Palestinian balance of payments amounting to 665 million US dollars in the second quarter of 2025, reflecting a decrease of 31% compared to the previous quarter.

They explained in a report on the preliminary results of the Palestinian balance of payments for the second quarter of 2025 that the merchandise trade balance deficit reached 1,075 million US dollars, while the services balance recorded a deficit of 210 million US dollars.

Data indicated a decrease in net income account during Q2 2025 by 23% compared to the previous quarter, reaching 195 million US dollars, as compensation for Palestinians working in Israel decreased by 31% compared to the previous quarter, amounting to 127 million dollars. Meanwhile, income from foreign investments increased by 2%, totaling 93 million US dollars, primarily due to interest received on Palestinian deposits in foreign banks.

It also indicated an increase in net current transfers by 10% to 425 million US dollars compared to the previous quarter, as current transfers from abroad to the government sector rose to 284 million dollars.

Conversely, transfers to other (non-governmental) sectors decreased by 53% compared to the previous quarter.

It is noted that current transfers to the government sector constituted 59% of total current transfers from abroad, while current transfers to other sectors represented 41%. It is worth mentioning that transfers from donor countries account for about 67% of total current transfers from abroad.

The preliminary results of the balance of payments also indicated a surplus in the capital and financial account amounting to 4 million US dollars, as a result of the deficit observed in the financial account amounting to -76 million US dollars.

In contrast, reserve assets at the Palestinian Monetary Authority recorded a decrease of 32 million US dollars during this quarter compared to an increase of 127 million US dollars in the previous quarter.