From the just released “Semiannual Report on International Economic and Exchange Rate Policies”
Korea’s current account surplus further increased to 6.1 percent of GDP in 2013 – the highest since 1999 – compared to 4.2 percent in 2012. Korea is one of only a few surplus economies with a significantly larger external surplus now than before the crisis. Net exports accounted for over half of Korea’s growth in 2013, highlighting the economy’s continued dependence on external demand and the weakness of domestic demand. Although Korea does not publish data on its foreign exchange intervention, during the second half of 2013 the Korean authorities are believed to have intervened to limit the pace of won appreciation. Korea’s foreign exchange reserves rose from $315.6 billion at end-June 2013 to $335.6 billion at end-December and $341.0 billion at the end of February 2014. The Korean authorities also increased their net forward position by $4.9 billion to $50.5 billion over the second half of 2013. The magnitude of these changes is larger than can be reasonably expected from simple interest earnings on the existing stock of reserve assets or valuation changes. The Korean authorities should limit foreign exchange intervention to the exceptional circumstances of disorderly market conditions and increase the transparency of their interventions in foreign exchange.
On behalf of South Korea we would like to thank the US Treasury, whose debt issuance the Fed has montized for the past five years and kept the USD low – this permission is very generous of you.
via Zero Hedge http://ift.tt/1t6ZXkp Tyler Durden