Korea's current account surplus decreases sharply in October following extended Chuseok holiday

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Korea's current account surplus decreases sharply in October following extended Chuseok holiday

Published: 05 Dec. 2025, 18:26 Updated: 05 Dec. 2025, 18:51

Audio report: written by reporters, read by AI

Export vehicles are parked at Pyeongtaek Port in Gyeonggi on Dec. 1. [YONHAP]

Korea’s current account surplus shrank sharply in October after a long Chuseok holiday cut factory workdays and prompted more overseas travel, the Bank of Korea (BOK) said on Friday.

According to the BOK’s report released on the same day, the current account posted a $6.81 billion surplus in October, extending its streak of monthly surpluses to 30 consecutive months. But the surplus fell significantly to 49.4 percent from September’s $13.47 billion. It dropped 27.5 percent from October a year earlier, when it totaled $9.4 billion. The current account measures what a country earns from trade in goods and services, along with other cross-border income flows.

The main drag came from goods trade, which refers to the difference between exports and imports. The goods account is the most significant component of the current account. The goods surplus totaled $7.82 billion in October, down 45 percent from $14.24 billion in September, and below the $8.07 billion surplus recorded a year earlier.

Exports fell to $55.88 billion in October, down 16.9 percent from $67.27 billion in September. They also declined 4.7 percent from a year earlier.

Semiconductors and other IT exports continued to grow, but other categories weakened. Ship exports retreated after a one-time surge in October, and with fewer workdays during the extended Chuseok holiday, exports decreased year-on-year for the first time in two months.

On a customs-clearance basis, semiconductor exports rose 25.2 percent from a year earlier, and computer peripherals rose 3.5 percent. However, exports of wireless communication devices fell 8.7 percent, steel products 14.1 percent, chemical products 13.1 percent and passenger cars 12.6 percent.

The Chuseok holiday period also widened the services trade deficit. The services account is the difference between the money domestic residents earn from providing services to nonresidents and the money they pay for those services. The services account recorded a $3.75 billion deficit in October, larger than September’s $3.32 billion deficit and October a year earlier, when the deficit was $1.93 billion.

Export containers are stacked at the Pyeongtaek Port in Gyeonggi on Nov. 14. [YONHAP]

The travel account drove much of the deterioration. Its deficit widened to $1.36 billion in October from $910 million in September and $490 million a year earlier as more Koreans traveled abroad during the holiday.

Song Jae-chang, a BOK official, said the “current account surplus for January through October reached a record high.” He said the “October slowdown reflected holiday effects, but the surplus was likely to rebound from November as those effects faded and semiconductor exports supported a sizable trade surplus, and that the monthly current account surplus could return to above $10 billion.”

Korea’s net financial account assets — the increase in residents’ overseas financial assets minus the increase in foreigners’ financial claims on Korea — rose by $6.81 billion in October.

Overseas portfolio investment by Korean residents jumped, led by stock buying amid continued enthusiasm among retail investors for foreign shares. Residents’ stock investment totaled $18.04 billion, and overall securities investment rose $17.27 billion in October. Foreigners’ investment in Korea increased by $5.2 billion, with the bulk concentrated in equities.

“Residents’ overseas securities investment totaled $117.12 billion from January through October, up from $71.0 billion in the same period last year,” said Song.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM NAM-JUN [[email protected]]