South Korea Current-Account Surplus Narrows to 3-Month Low as Exports Slow

South Korea’s current-account surplus narrowed to a three-month low in December as the trade surplus shrank on slowing exports and a jump in energy imports.

The surplus was $3.96 billion, compared with a revised $4.56 billion in November, the Bank of Korea said in today’s statement in Seoul. The current account is the broadest measure of trade, tracking goods, services and investment income.

Weak external demand is set to “weigh on Korean exports,” Ronald Man, a Hong Kong-based analyst at HSBC Holdings Plc. said before today’s data. At the same time, “Korean manufacturers are well positioned to remain price competitive on the global stage given input price growth has continued to ease alongside a weak won,” he said.

South Korea’s economy grew the least in two years in the fourth quarter as exports sank because of Europe’s sovereign debt crisis and a faltering global expansion, a government report showed last week. Bank of Korea Governor Kim Choong Soo said Jan. 17 that interest rates are below “the desirable level,” indicating that policy makers may be cautious in making reductions to support growth.

The surplus on traded goods was $3.85 billion last month from a revised $4 billion in November, today’s report showed.

Total exports on a customs-cleared basis rose 10.8 percent from a year earlier to $48.9 billion in December after an 11.6 percent gain in November, dented by a decline in overseas shipments of mobile phones and display panels, according to today’s statement. Imports increased to $45.5 billion from $43 billion on seasonal demand for oil and gas.