South Korea Logs Record Current Account Deficit in January

Current account balance, the broadest measure of cross-border trade, posted a deficit of 4.52 billion US dollars in January, after recording a surplus of 2.68 billion dollars in the prior month, according to the Bank of Korea (BOK).

It was the biggest deficit since relevant data began to be compiled in 1980.

Export dropped 14.9 percent from a year earlier to 48 billion dollars in January, while import gained 1.1 percent to 55.46 billion dollars.

Trade deficit for goods amounted to 7.46 billion dollars, staying in the red for the fourth successive month.

Services account deficit expanded to 3.27 billion dollars in January from 1.39 billion dollars in the previous month.

Local demand mounted for overseas trip on the back of the moderated measures against the COVID-19 pandemic.

Travel account deficit stood at 1.49 billion dollars in January, up from 1.14 billion dollars in the prior month.

Surplus for primary income account, which includes monthly salary and investment income, came in at 6.38 billion dollars in January on higher dividend income at the beginning of the year.

Financial account, which measures cross-border capital flow without transactions in goods and services, recorded a net inflow of 640 million dollars in January, after posting a net outflow of 5.06 billion dollars in the previous month.

Overseas direct investment by domestic residents rose by 1.77 billion dollars, and foreign direct investment in South Korea gained by 1.17 billion dollars.

For the portfolio investment, which includes stock and bond trading, overseas investment by local residents climbed by 3.69 billion dollars, while foreign investment in domestic stocks and bonds grew by 5.4 billion dollars.

4155/v