In the second quarter of 2025, Latvia's current account deficit expanded significantly, reaching -4.50% of GDP, according to the latest data updated on September 5, 2025. This marks a notable increase from the first quarter of the year, where the deficit stood at -3.00%.
The widening of the deficit could raise concerns among policymakers and investors as it implies that the country's imports continue to outstrip its exports, potentially indicating an imbalance that might affect economic stability. The reasons behind the growing deficit may include an increase in domestic consumption or a decrease in foreign demand for Latvian goods and services, although specific details were not disclosed in the report.
Such developments could have implications for Latvia's monetary policy and may prompt the central bank to consider adjustments to address the financial gap. Analysts will continue to monitor upcoming economic data to assess the impact of this growing deficit on the broader economic landscape of Latvia.
