Overseas demand for Eurozone equities more than doubled during the 12 months to the end of August, with total purchases rising from €134 billion to €333 billion.

European Central Bank data showed the block’s collective bank balance with the rest of the world fattening, with the Eurozone pulling in €33.3 billion more from overseas than went out during the month. This is a greater surplus than the €26.2 billion forecast by economists.

Current account data is important because it reflects both domestic and international demand for a currency.

Investors and traders have been watching closely of late because inflows of foreign money into Eurozone stocks were among the key drivers of the common currency’s gains earlier in the year.

A rising surplus suggests foreign investors are pumping more money into an economy and/or domestic investors are repatriating increasing sums from overseas.

In August foreign investors bought €19 billion more Eurozone stocks than they sold although the impact of this on the current account was more than offset by a €45 billion exodus from Eurozone bond markets.

Nonetheless, for the twelve months to the end of August, overseas demand for Eurozone equity more than doubled, with total purchases rising from €134 billion to €333 billion.

The data comes ahead of next week’s ECB meeting which is expected to yield a formal announcement detailing the winding down of the Eurozone quantitative easing (bond buying) program.

“When it comes to monetary policy, the art of managing expectations is key to preventing large market reactions,” says Guy Stear, an economist at Societe Generale. “Central bankers are happy to be transparent in order to avoid market disruptions, and we will soon know whether the ECB has managed expectations correctly.”

The Euro was quoted 0.37% lower at 1.1804 against the Dollar during early trading Friday. The Euro-to-Pound rate was marked down 0.28% at 0.8985.

Friday’s current account number also comes amid tensions over the likely outcome of the Catalan independence standoff.

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Leaders of the Northern province in Spain were given a deadline of 10:00 am Thursday to renounce their earlier threat of a unilateral declaration of independence or face Madrid’s invocation of Article 155 of the Spanish constitution.

This would result in revocation of Catalonia's limited autonomy and Madrid seizing control of its regional government functions, which many have feared will reignite the civil unrest seen during the recent referendum. The deadline lapsed without event on either side.

“In the absence of a reply in these terms, therefore, it is clear and precise, the Government understands that it has not responded to its request and will therefore continue with the procedures provided for in Article 155 of the Constitution with the objective of restoring legality in Catalonia,” the Madrid government responded, in a statement.

With Spain setting its sights on the invocation of Article 155 the Catalan leader Carles Puigdemont told the regional parliament, in response, that any move to seize control of the local administration would result in an immediate unilateral declaration of independence.

The Catalans have spent the recent fortnight seeking to use the outcome of October’s referendum to force Madrid into talks over a managed separation or greater autonomy for the province.

Madrid has rebuffed these overtures, insisting that Catalan officials recognise the referendum as invalid and abandon their push for independence.

“The President of the Government has called for next Saturday in extraordinary session to the Council of Ministers. In that Council of Ministers, the measures that it will raise to the Senate in order to protect the general interest of the Spaniards, among them the citizens of Catalonia, all the citizens of Catalonia, and to restore the constitutional order in the Autonomous Community will be approved,” Madrid adds in its noon response.

In the absence of a climbdown from one side or the other, a special cabinet meeting will be held in Madrid Saturday to push ahead with the invocation of Article 155.

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