S.Korea July s/adj current account edges up from June

SEOUL: South Korea's seasonally adjusted current account surplus inched up in July from June, extending an uninterrupted run of surplus since early 2009 and marching toward a record surplus for the whole year, data showed on Thursday.

Asia's fourth-largest economy posted a current account surplus of $4.97 billion in July in seasonally adjusted terms, up from a revised $4.79 billion surplus in June, according to data from the Bank of Korea, the central bank.

In July, exports grew a seasonally adjusted 3.1 percent to $45.87 billion over the month before while imports also rose, but at a slower pace of 0.9 percent to $41.94 billion, resulting in a goods account surplus of $3.92 billion, the data showed.

South Korea, also the world's seventh-largest exporter, has not posted a monthly current account deficit since January 2009, thanks to robust sales abroad of electronics goods and cars amid depressed prices of raw materials that it imports.

In annual terms, South Korea has kept the current account firmly in surplus each year since the 1997 Asia financial crisis and posted a $43.1 billion surplus last year, one of the largest among the major economies.

The Bank of Korea's latest projection published in early July tips this year's current account surplus to reach $53 billion, which would amount to well more than 4 percent of the country's annual gross domestic product.

Thursday's data showed the current account surplus in July amounted to $6.77 billion without adjustment for seasonal patterns, bringing the surplus for the first seven months of this year at $36.55 billion.

The data came as some emerging economies with weak international balance of payment positions have been hit especially hard by capital flight away from emerging markets on the prospects of rising yields in developed regions.

Analysts say South Korea is expected to navigate the tides of capital flight relatively well thanks to its healthy balance of payment position, notably the strong current account.

"Korea's balance of payments should remain well supported by a strong current account," Ronald Man, an economist at HSBC in Hong Kong, said in a note. "(Korea is) unlikely to come under pressures similar to during the run-up to the 1997 Asian Financial Crisis and 2008 global financial crisis."