South Korea's current account balance in February shifted to a surplus of 3.68 billion dollars, the Bank of Korea said on Monday, following the 1.64 billion dollars deficit in January.
The goods account shifted from the previous month's $1.74 billion deficit to a surplus of $3.15 billion as despite a year on year fall in both exports and imports, imports decreased at a faster rate than exports.
The services account deficit narrowed to $0.49 billion from $0.71 billion a month earlier, as the travel account surplus widened greatly, offsetting increased payments of royalties and license fees. The income account continued to register a surplus, standing at $0.52 billion dollars similar to that of the previous month's $0.56 billion. The current transfers account surplus rose from $0.25 billion dollars a month earlier to $0.5 billion, driven by an improved external remittance account.
The capital and financial account in February shifted from January's net inflow of 5.14 billion dollars to a net outflow of $3.32 billion.
The capital and financial account in February shifted from January's net inflow of 5.14 billion dollars to a net outflow of 3.32 billion dollars. The direct investment account registered a net outflow of $0.55 billion, up from the previous month's $0.06 billion, as inward foreign direct investment decreased from the previous month whereas outward foreign direct investment increased.
The portfolio investment account registered a net inflow of $0.16 billion, a sharp decrease from the previous month's $5.68 billion since foreign investors changed to net sellers of Korean securities, even though Korean residents' net repatriation of overseas portfolio investment, increased from the previous month.
The financial derivatives account recorded a net outflow of $2.80 billion, an increase from the previous month's $0.25 billion, as losses realized through derivative transactions increased more than gains due to a rising foreign exchange rate. The other investment account registered a net outflow of $0.48 billion, due to an increase of domestic banks' overseas deposit assets.
The capital and financial account recorded a net inflow of $1.82 billion during the January to February period. Reserve assets increased by $1.26 billion.
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