South Korea’s Current-Account Surplus Widens in March
South Korea’s current-account surplus widened in March to a four-month high as overseas shipments of cars, electronics and oil products rose while the European debt crisis weighed on global demand.
The surplus was $3 billion, compared with a revised surplus of $557 million in February, the Bank of Korea said in a statement in Seoul today. The current account is the broadest measure of trade, tracking goods, services and investment income.
Asia’s fourth-largest economy, which expanded at the fastest pace in a year in the first quarter, faces downside risks from the European debt crisis and high oil prices, the central bank said this month. It left borrowing costs unchanged for a 10th straight month on April 13 as it forecast a “moderate recovery” in domestic demand.
“We’re passing a bottom but global demand will likely remain weak, which bodes ill for exporters,” Yoon Yeo Sam, a fixed-income analyst at Daewoo Securities Co. in Seoul, said before the release. “With moderate growth and persistent inflation pressures, policy makers seem to have limited room for moving interest rates in either direction.”
The won rose 0.4 percent to close at 1,136.32 per dollar in Seoul yesterday, according to data compiled by Bloomberg. The Kospi Index advanced 0.1 percent.
The surplus on traded goods was $3 billion last month compared with a revised $1.3 billion surplus in February, today’s report showed.
Total exports on a customs-cleared basis rose to $47.4 billion in March from $46.4 billion in February, according to today’s statement. Imports totaled $44.9 billion, little changed from February.
Overseas shipments may fall 1.5 percent in April from a year earlier, according to the median estimate of nine economists in a Bloomberg News survey as of April 26.
The current-account surplus is expected to narrow to $12.5 billion in 2013 from an estimated $14.5 billion this year, according to the central bank’s latest projection. The excess was $26.5 billion in 2011.
South Korea’s gross domestic product rose 0.9 percent in the first quarter from the previous three months, the fastest pace in a year, according to a central bank report yesterday.
The nation is “very well prepared” to resist or face any unexpected shock arising from uncertainty in the world economy, Angel Gurria, secretary general of the Organization for Economic Cooperation and Development, told reporters in Seoul yesterday.
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