FX.co ★ Iceland Current Account Gap Hits 18-Year High

Iceland’s current account deficit widened to ISK 120.3 billion in the second quarter of 2026, up from ISK 115.9 billion in the same period a year earlier. This was the largest current account shortfall since the second quarter of 2008. The deterioration was driven primarily by a sharp increase in the goods trade deficit, which rose to ISK 154.4 billion from ISK 128.1 billion, reflecting much stronger import growth: imports were up 8.6%, while exports increased by a more modest 2.3%. By contrast, the primary income deficit narrowed to ISK 18.0 billion from ISK 32.8 billion, and the services surplus widened to ISK 66.6 billion from ISK 61.9 billion a year earlier. The secondary income deficit also improved, narrowing to ISK 14.5 billion from ISK 16.8 billion.