Korea October current account surplus tumbles as exports slide
Do-Won Lim
Dec 09, 2022 (Gmt+09:00)
South Korea’s current account surplus plunged as exports fell for a second straight month, adding to concerns over a slowdown in Asia’s fourth-largest economy amid a global downturn.
The country reported a current account surplus of $883.4 million in October, sharply lower than $8 billion a year earlier, preliminary central bank data showed on Friday.
Goods exports skid 6% to $52.6 billion from a year earlier after dipping by a revised 1.1% in September, the first year-on-year fall in 23 months. Semiconductor exports declined 16.4% in October amid weak demand worldwide. South Korea is home to the world’s two largest memory chipmakers – Samsung Electronics Co. and SK Hynix Inc.
On the other hand, goods imports grew 8.5% to $54.1 billion with commodity intakes up 9.9%. Imports of gas and crude oil jumped 79.8% and 24.2%, respectively, while purchases of coal soared 40.2%.
The sluggish exports forced the goods account to swing to a deficit of $1.5 billion in October from a $466.2 million surplus in the prior month.
The government expected the current account to be volatile in the coming months.
In the first 10 months of the year, South Korea logged a current account surplus of $25 billion in total, less than a third of the $75.4 billion a year earlier.
CAPITAL INFLOWS FOR SECOND CONSECUTIVE MONTH
South Korea reported capital inflows in November for a second straight month, according to separate data from the Bank of Korea.
The country’s financial markets saw an influx of $2.7 billion last month after inflows of $2.8 billion in the previous month.
Foreign investors bought a net $2.1 billion won in local stocks in November after purchasing a net $2.5 billion in the prior month. Bond markets also enjoyed inflows of $630 million after $280 million.