Korea predicted to log current account surplus in October

SEOUL, Oct. 29 (Yonhap) -- South Korea's current account is widely forecast to
swing to the black in October on the back of an expected surplus in the trade
balance, the central bank said Wednesday.
"In October, the country's current account is likely to log a surplus between
US$500 million and $1 billion," an official at the Bank of Korea (BOK) said,
asking not to be named. "In November and December, the country is expected to
post a bigger surplus, and the surplus of the current account is likely to reach
$4 billion in the fourth quarter."
The remarks came as South Korea posted a current account deficit of $12.6 billion
in the first eight months of this year, putting downward pressure on the local
currency. In August, the current account shortfall reached a record high as the
goods balance posted the largest shortfall in 12 years. The won has declined
about 34 percent against the U.S. dollar so far this year.
South Korea's foreign exchange markets have been suffering from a dollar shortage
as banks and companies are scrambling to hoard the safer greenback on concerns of
a financial crisis sparked by the collapse of investment bank Lehman Brothers
Holdings Inc.
BOK Gov. Lee Seong-tae said in early October that the instability of South
Korea's currency market is expected to firm up once its current account deficit
goes back to the black in the coming months.
He said the country is expected to post a current account surplus in the fourth
quarter, which would help ease fragile sentiment in the foreign exchange market.
The central bank said South Korea is forecast to log an annual current account
deficit of about $10 billion, which would mark the first deficit since 1997.
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