South Korea’s current-account surplus fell in April from a four-month high in March on weaker trade gains as concerns grew about a global slowdown, the Bank of Korea said Wednesday.
The current-account surplus, the broadest measure of South Korea’s trade with the rest of the world, totalled $1.78 billion in April, down from a revised $2.97 billion in March. That compared with a surplus of $1.28 billion in April last year.
On a seasonally adjusted basis, the current-account surplus fell to $1.62 billion from $3.12 billion in the previous month.
Analysts said South Korea’s current account likely will sustain a surplus trend throughout this year, following a brief dip into a deficit in January, lending continued support to the won, although the size of the surplus is expected to shrink over time.
In recent months, growth in exports from Asia’s fourth-largest economy moderated, while imports also slowed on lackluster local demand, which could reduce the country’s current-account surplus in 2012. Higher global oil prices also will boost import prices, hurting the export-dependent economy.
The central bank expects the country to run a larger current-account surplus in May compared with April.
“Steady exports of automobiles and a decline in global raw material prices will likely help Korea post a larger current-account surplus in May,” Yang Jae-ryong, senior manager at the BOK’s economic statistics department, said at a media briefing.
The BOK currently forecasts the country to run a current-account surplus of $14.5 billion this year, down from a surplus of $27.65 billion in 2011.
Wednesday’s data showed the goods account had a surplus of $1.8 billion in April, down from a surplus of $2.93 billion in March. The BOK attributed the smaller trade surplus to weak exports of semiconductors, telecommunications devices and oil products.
The pace of growth in shipments of major items slowed and exports to key regions fell, clouding the outlook for the country’s surplus.
Exports to European countries fell 20.7 percent in April from the year-earlier period, following a 20.4 percent on-year decline in March. Shipments to China-South Korea’s largest export market-declined 2.9 percent after March’s 4.2 percent fall, while exports to the US rose 4.3 percent, slowing from a 27.8 percent rise in the previous month.
The service account, which includes outlays by South Koreans on overseas trips, posted a surplus of $550 million last month, down from a surplus of $700 million in March.
April’s primary income account, which tracks wages for foreign workers and dividend payments overseas, logged a deficit of $420 million, widening from a deficit of $320 million in March.
The financial account, covering cross-border investments, posted a net inflow of $20 million in April, reversing a net outflow of $1.86 billion in March, the central bank said. -By In-Soo Nam