Foreign currency deposits held by South Koreans reached a fresh high of $93.32 billion in October as companies and individuals stockpiled U.S. dollar holdings while the greenback became its cheapest in nearly two years against the Korean won.
According to data released by the Bank of Korea on Wednesday, the outstanding balance of foreign currency deposits reached a record high of $93.32 billion as of end of October, up $7.87 billion from the previous month. The previous largest amount was $88.54 billion in August.
Foreign currency deposits are holdings by Korean individuals and companies, foreigners residing in Korea for six months or longer, and foreign companies operating in Korea.
Since June, foreign currency deposits have been breaking records for three straight months before dropping $3.1 billion in September. Foreign currency savings rebounded in just one month to reach an all-time high in October.
By subject, foreign currency deposits held by companies increased $7.2 billion over one-month period to $74.73 billion in October and those by individuals $670 million to $18.59 billion.
By currency, U.S. dollar holdings added $6.85 billion on month to $80.32 billion in October while euro-denominated deposits $540 million to $4.4 billion. Yen deposits also added $340 million to $5.29 billion while yuan holdings $50 million to $1.68 billion.
The BOK said that the surge in foreign currency deposits in October came on multiple elements such as an increase in payment fund deposits by companies amid recovery in exports and imports and also in overseas short-term operation funds by brokerages. Demand was also high among individuals to buy U.S. dollars amid weakening trend.
By Lee Eun-joo
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