Korea posts its largest ever July surplus of 42.08 billion dollars as exports rise 65.3 percent
South Korea recorded a current account surplus of 42.08 billion dollars in July 2026, the Bank of Korea reported on 4 September, against 10.78 billion dollars in July 2025. Goods did almost all of it: the goods account produced a surplus of 40.43 billion dollars, which is 96.1 percent of the current account total, on our calculation, as exports reached 100.45 billion dollars and rose 65.3 percent on a year earlier.
It is the largest July in the series and the second largest month Korea has ever recorded, behind June 2026. It is not a record month, and the distinction matters: June produced 49.73 billion dollars, so July is 7.65 billion or 15.4 percent below it, on our calculation.
A trade account running at 1.7 times imports
| July 2026, dollars bn | Balance |
|---|---|
| Goods | 40.43 |
| Services | -1.97 |
| Primary income | 4.35 |
| Secondary income | -0.73 |
| Current account | 42.08 |
Preliminary figures. Goods exports were 100.45 billion dollars and imports 60.02 billion on a balance of payments basis, giving an export to import ratio of 1.67, on our calculation.
The gap between the two growth rates is the finding. Exports rose 65.3 percent and imports 21.7 percent, a difference of 43.6 percentage points, on our calculation. A surplus can widen because exports are strong or because imports are weak; this one is the first, with imports still growing at more than 20 percent.
Services stayed in deficit at 1.97 billion dollars, the central bank attributing it to the other business services and manufacturing services accounts, with travel contributing a deficit of 0.34 billion. Primary income delivered a surplus of 4.35 billion dollars, of which investment income was 4.59 billion, driven by income on equity of 3.83 billion.
The semiconductor line, and why it is not the same measure
Alongside the balance of payments the central bank publishes customs based trade detail supplied by the Korea Customs Service. On that basis semiconductor exports reached 41.17 billion dollars in July and rose 176.3 percent on a year earlier, against total customs exports of 98.96 billion, up 63.0 percent.
Those two bases are not interchangeable, and the central bank says so in its own footnote. Customs exports of 98.96 billion sit 1.49 billion dollars below the 100.45 billion in the balance of payments, on our calculation, so the semiconductor figure cannot be presented as a share of the balance of payments export total. On its own customs basis, semiconductors were 41.6 percent of exports, on our calculation, and grew at 2.8 times the rate of the total.
The import side carries the counterweight. Customs imports rose 26.5 percent to 68.57 billion dollars, or 23.0 percent excluding energy, with crude oil up 54.2 percent to 9.32 billion at an average import price of 100.0 dollars a barrel, itself 40.5 percent higher than a year earlier.
Seven months at nearly 4 times last year
| Dollars bn | 2026 | 2025 |
|---|---|---|
| May | 38.61 | 10.14 |
| June | 49.73 | 14.27 |
| July | 42.08 | 10.78 |
| January to July | 233.09 | 59.82 |
The cumulative figures are published by the central bank rather than summed from monthly releases. The seven month total is 3.90 times its year earlier equivalent, on our calculation.
The streak now runs to 39 consecutive monthly surpluses, from May 2023, the last deficit being 2.89 billion dollars in April 2023. No previous July has come close, and the second largest July in the series is July 2025.
The central bank has already moved its own expectation. In its Economic Outlook of 27 August, a week before this release, it raised the 2026 current account forecast to 450.0 billion dollars from 250.0 billion, against an actual 123.1 billion in 2025, and attributed the revision to semiconductor exports. Seven months in, the published cumulative is 51.8 percent of that forecast, on our calculation.
Where the money went
| Financial account, July, dollars bn | Net |
|---|---|
| Other investment | 27.56 |
| Portfolio investment | 5.40 |
| Financial derivatives | 5.03 |
| Direct investment | 4.13 |
| Reserve assets | -1.80 |
Net asset increases. The total was 40.32 billion dollars, against a current account surplus of 42.08 billion, a difference of 1.76 billion, on our calculation. Other investment alone was 68.4 percent of the financial account, on our calculation, and within it loans rose 12.14 billion and currency and deposits 9.28 billion on the asset side.
That composition is worth noting. A surplus recycled principally through loans, deposits and other investment rather than through direct or portfolio investment is a different pattern from the one Korea ran during earlier surplus periods, and it is the least sticky of the categories.
Why it matters: An external surplus running at nearly 4 times its year earlier level, on our calculation, is a large and sustained transfer of national savings abroad, and it is now concentrated in a single product. Semiconductors grew at 2.8 times the rate of total customs exports, on our calculation, which means the current account has become a proxy for one industry’s pricing cycle rather than a measure of broad competitiveness. The central bank’s own forecast revision, from 250.0 billion dollars to 450.0 billion in three months, is the clearest statement of how fast the picture changed and how uncertain it remains. For trading partners the same numbers read as a widening imbalance, and for Korea they arrive alongside a base rate raised to 3.00 percent in August, so an exceptional external surplus is being met with a tighter domestic stance rather than an easier one.
Outlook: Concentration is the risk the central bank itself names, since a forecast built on semiconductor demand and prices inherits the volatility of both. Watch the import side as closely as the export side: crude at an average 100.0 dollars a barrel already lifted the oil bill 54.2 percent in July, and a further increase would narrow the goods surplus without any change in export performance. The cumulative total is a little over half the annual forecast with five months to run, so the remaining months need to average roughly 43 billion dollars for it to be met, on our calculation, which is above every month this year except June. On the financial side the weight of other investment is the thing to follow, because loans and deposits reverse faster than direct or portfolio positions.
Sources: Bank of Korea, Korea Customs Service.
