South Korea’s current account surplus fell for the second straight month in July, but exports increased and the central bank forecast a record surplus by the end of the year.
The current account surplus, the broadest measure of South Korea’s trade with the rest of the world, stood at $6.77 billion last month, the Bank of Korea said on Thursday, down from $7.24 billion in June and a record $8.64 billion in May.
The bank attributed the downward trend to increased expenditure on overseas trips during the summer holiday season.
Exports in Asia’s fourth largest economy rose 3.8 percent on-year to $48.39 billion and imports gained 3.5 percent to $42.71 billion in July, resulting in a $5.68 billion trade surplus.
For the first seven months of the year, the current-account surplus totalled $36.55 billion and the central bank said it expected a total 2013 surplus of $53 billion, exceeding last year’s record of $43.14 billion.
The solid surplus provides South Korea with a buffer against external funding risks fuelled by concerns over the impact of the end of the US Federal Reserve’s stimulus.
The service account, which includes outlays by South Koreans on overseas trips, posted a $357 million surplus last month, down from $1.18 billion the previous month.
–Dow Jones Newswires contributed to this report –
S.Korea current account surplus falls in July
