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South Korea's Current Account Surplus Narrows To $5.28 Billion In January

By March 4, 2017 at 4:09 am
South Korea worries that US criticism of its current account surplus could lead to a possible tagging as a currency manipulator by Washington. (Photo : Getty Images)

South Korea's current account surplus narrowed in January compared to December last year, due to rising deficit in the service balance, according to preliminary data from the Bank of Korea released Friday.

The country's current account surplus climbed to US$5.28 billion in January, compared to $7.18 billion a year earlier, the central bank data showed. That follows a surplus of $7.87 billion in December last year.

The January current account represents the 59th consecutive month of surplus, according to a report by Yonhap News Agency. The current account is the most comprehensive measure of cross-border trade.

In seasonally adjusted terms, South Korea's current account surplus in the first month of 2017 climbed to $10.51 billion, the highest level in a year, from a revised $8.31 billion surplus last December, according to a report by Reuters.

Exports in January climbed by a seasonally adjusted 8.0 percent on-month to $47.96 billion while imports slightly gained 1.4 percent to $35.98 billion. This created a seven-month high $11.98 billion goods surplus, resulting in a surplus in the headline current account, the Reuters report said.

The primary income account surplus fell to $1.09 billion from $1.23 billion, in line with a decline in the income on equity account. The secondary income account posted a deficit of $0.27 billion, according to a report by RTT News.

For the entire year 2016, South Korea's current-account surplus fell from the previous year, according to central bank data released last month. The current account surplus came at $98.68 billion last year, down from a $105.94 billion surplus a year earlier, a report by The Korea Herald said.

South Korea worries that US criticism of its current account surplus could lead to a possible tagging as a currency manipulator by Washington.

Last October, the country was placed by the Treasury Department under its currency watch list, along with China, Germany, Japan, Switzerland and Taiwan, because it met two of the three criteria of bad currency practices, which includes a current account surplus of 3 percent of GDP, according to a report by Bloomberg News. 

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