South Korea's Foreign Currency Deposits Experience Second Monthly Decline in February
Synopsis
In February, South Korea's foreign currency deposits decreased for the second month in a row, driven by a drop in individual and corporate accounts. This trend raises concerns amid ongoing economic fluctuations and a crisis in the Middle East affecting energy supplies.
Key Takeaways
South Korea's foreign currency deposits fell for the second consecutive month.
Outstanding deposits totaled $117.53 billion, down $490 million from January.
Corporate deposits decreased by $450 million, while individual deposits dropped by $40 million.
Euro-denominated deposits rose, while U.S. dollar and yen deposits fell.
The government is considering a supplementary budget to stabilize energy supplies.
Seoul, March 23 (NationPress) In February, South Korea witnessed a decline in foreign currency deposits for the second consecutive month, primarily due to a drop in both individual and corporate holdings, according to data released by the central bank on Monday.
The total outstanding foreign currency deposits held by residents reached US$117.53 billion at the end of February, reflecting a decrease of $490 million from the previous month, as reported by the Bank of Korea (BOK) and covered by Yonhap news agency.
In January, the country experienced its first month-on-month decline in foreign currency deposits since October, following gains in November and December that had pushed the total to a record high amid a weakened won and increased volatility in the foreign exchange market.
The term “residents” includes South Korean nationals, foreigners who have resided in the country for over six months, and foreign enterprises. It’s important to note that interbank deposits are not included in this data.
Corporate foreign currency deposits fell by $450 million in February, amounting to $100.23 billion, while individual deposits decreased by $40 million, bringing the total to $17.31 billion.
Analyzing the deposits by currency, U.S. dollar-denominated deposits fell by $340 million, totaling $96 billion, and Japanese yen deposits decreased by $210 million to $9.3 billion.
Conversely, euro-denominated deposits saw an increase of $200 million, reaching $9.59 billion, whereas deposits in Chinese yuan dropped by $150 million, totaling $1.23 billion, according to the data.
Additionally, during a parliamentary confirmation hearing, Budget Minister nominee Park Hong-keun stated that the proposed supplementary budget should aim at stabilizing energy supplies, including oil reserves, amid the ongoing crisis in the Middle East.
Park mentioned, "Even though a fuel price cap is in effect, a supplementary budget is crucial considering the uncertainties, as we cannot foresee how long the situation in the Middle East will persist."
In light of rising global oil prices, the government has implemented a price cap on products supplied by oil refineries to gas stations to alleviate the financial strain caused by soaring fuel prices amid supply concerns arising from the conflict.
The minister emphasized that the additional budget should focus on securing key items for future supply chain reliability and diversifying supply routes, which includes stockpiling oil.
Point of View
It's clear that the decline in foreign currency deposits in South Korea is a trend worth monitoring. Economic fluctuations and external pressures, particularly related to the Middle East crisis, could impact future financial stability.
NationPress
11 May 2026
Frequently Asked Questions
What caused the decline in foreign currency deposits in South Korea?
The decline is attributed to a drop in both individual and corporate deposits, as indicated by the Bank of Korea's data.
How much did foreign currency deposits decrease in February?
Foreign currency deposits fell by $490 million, totaling $117.53 billion at the end of February.
What types of residents are included in the foreign currency deposit data?
Residents include South Korean citizens, foreigners living in the country for over six months, and foreign companies, excluding interbank deposits.
Which currencies saw the most significant changes?
U.S. dollar deposits decreased by $340 million, while euro deposits increased by $200 million.
What measures did the Budget Minister nominee propose regarding energy supplies?
The nominee suggested that the supplementary budget should include strategies to stabilize energy supplies amidst the ongoing crisis in the Middle East.
