Current account surplus registers one-year high

By Kang Seung-woo

Staff reporter

The Bank of Korea (BOK) Wednesday announced that the current account registered a surplus of $5.04 billion last month, up from a revised $3.82 billion from the previous month.

The current account is the broadest measure of trade that reflects the movement of goods and services.

The surplus is the third biggest monthly amount. Korea logged the largest surplus of $6.64 billion in March 2009. In June last year, its surplus reached $5.38 billion.

In addition, the Korean economy has extended its current account surplus streak to five months since February.

The current account surplus in the first half was tallied at $11.61 billion, down about $10 billion from a year earlier.

The BOK revised up its projection for this year’s current account surplus to $21 billion from $10.5 billion thanks to strong exports earlier this month.

It expects next month’s current account to stay at a similar level to that of June.

“The shortfall of the service account will likely widen on increased spending on overseas travel during the summer vacation, but the country is forecast to post a significantly large surplus for July on robust overseas shipments,” Lee Young-bog, head of the BOK’s balance of payments statistics team, said at a press conference.

The country’s balance of goods posted a surplus of $6.35 billion thanks to robust exports. The numbers are also the highest since last June, when it saw a surplus of $6.6 billion.

Exports climbed 31.7 percent to $41.6 billion, while imports soared 41.1 percent to $35.2 billion.

The deficit of the service account, which includes spending by Koreans on overseas trips and studies, rose to $1.67 billion last month from the $642.7 million shortfall in May.

The deficit of the travel account, an element of the service account, also widened from $320 million to $350 million and that of the January-June period suffered a loss of $3.36 billion.

The capital account, a measurement of cross-border investment, registered a net outflow of $936 million in June, a steep decrease from the net outflow of $12 billion the previous month when the domestic branches of foreign banks repaid overseas borrowing.