FX.co ★ Iceland Trade Gap Narrows Sharply in January

The trade deficit for Iceland saw a significant reduction to ISK 0.3 billion in January 2026, compared to ISK 7.8 billion in January of the previous year. This represented the smallest trade deficit recorded since January 2019, when a trade surplus was documented. The primary factor was a slower decline in exports compared to imports. Specifically, exports fell by 20.9% year-over-year to ISK 72.4 billion, largely influenced by reduced shipments in manufactured goods, which decreased by 36.6%, and other products, which dropped by 49%. On the import side, there was a 26.8% decrease to ISK 72.7 billion, significantly impacted by declines in the acquisition of industrial supplies (down 35.8%), fuels and lubricants (down 41.2%), capital goods (down 35.2%), and transport equipment (down 23.5%).