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(2nd LD) Korea's current account surplus hits record high in H1
By Kim Soo-yeon
SEOUL, July 30 (Yonhap) -- South Korea's current account surplus narrowed in June from the previous month on smaller exports, but its combined surplus hit a record high in the first half, the central bank said Tuesday.

   The current account surplus reached US$7.24 billion in June, down from a record surplus of $8.64 billion the previous month, according to the Bank of Korea (BOK). The current account is the broadest measure of cross-border trade.

   The smaller surplus in June mainly came as exports of display panels, steel and petrochemical products lost ground on fewer working days, the bank said.

   But the June reading marked the 17th straight month of a surplus run and the country's cumulative surplus amounted to $29.77 billion in the January-June period, the largest ever on a first-half basis.

   The BOK recently revised up its 2013 current account surplus estimate to $53 billion from the previous $33 billion. If realized, the full-year surplus would be a record high, topping last year's $43.14 billion.

   BOK Gov. Kim Choong-soo said last week that the country's solid current account surplus has served as a buffer for the local financial market as bond yields are on the rise globally amid growing speculation about U.S. stimulus tapering.

   The BOK said that there is no reason to underestimate a marginal gain in exports in the first half as the country's overseas shipment is seen as faring well despite the global economic slowdown.

   On a customs-cleared basis, exports inched up 0.6 percent on-year to $276.65 billion in the first half.

   "If there are no external shocks, the full-year surplus estimate is seen as being valid," Jung Young-taek, the director general of the BOK's economic statistics division, told reporters.

   In June, the balance of Korea's goods posted a smaller surplus of $5.02 billion. Exports fell 3.1 percent on-year to $45.36 billion, while imports declined 3.4 percent to $40.33 billion.

   In what may be a worrying sign for China's economic slowdown, Korea's exports to China, its largest trading partner, grew 5.3 percent on-year in June, slowing from 16.5 percent in May. Seoul's shipments to Japan continued to decline last month by falling 17 percent on-year.

   "Seoul's exports to China slowed, but there is not a high chance that they will further worsen," Jung said without elaborating on the reason.

   The service account, which includes outlays by South Koreans on overseas trips, posted a surplus of $1.18 billion last month, compared with a surplus of $1.13 billion in May.

   The primary income account, which tracks wages of foreign workers and dividend payments overseas, logged a surplus of $957.2 million in June, larger than a surplus of $193.6 million in May.

   Meanwhile, the capital and financial account, which covers cross-border investments, posted a net outflow of $4.9 billion in June, compared with a record net outflow of $11.6 billion the previous month, the BOK said.