(Bloomberg) -- South Korea’s current account recorded the biggest surplus in more than six years, boosted by global demand for chips used in artificial intelligence and other technology exports that have underpinned the nation’s economic growth.
South Korea logged a net $12.3 billion current account surplus in June, the most since September 2017, with semiconductors and communications devices leading the export growth while imports of raw materials and capital goods fell, according to balance of payments data released Wednesday by the Bank of Korea. Net assets in the financial account also increased by $12.2 billion, the most since October 2020.
South Korean policymakers pointed to strong export momentum when they made the case for a calm response to a global market rout in recent days. The nation’s central bank kept its benchmark interest rate at what it considers a restrictive level last month on confidence that the economy remains on a solid path with top firms like Samsung Electronics Co. posting better-than-expected earnings.
Export growth showed in July, suggesting a slight cooling in global demand. Shipments of cars to the US may have fallen in particular, weakening the overall export momentum, according to Pantheon Macroeconomics. The US has been a key destination for South Korean exports and economists are awaiting more data to better assess demand in the world’s biggest economy after its job market showed slowing signs.
“The sudden slowdown in export growth might just be a blip,” Duncan Wrigley and Kelvin Lam at Pantheon wrote Tuesday. “The backdrop of a global chips upturn driven by AI demand remains unchanged.”
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