Let’s get the dollar expensive… Foreign currency deposits decreased in 4 months

Let’s get the dollar expensive… Foreign currency deposits decreased in 4 months

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Enter 2021.02.18 12:00

Firms settle import payments and sell spots when the exchange rate rises above 30 won
Individual dollar deposits only slightly decreased… All-time high in personal proportion

Last month, Korea’s foreign currency deposits declined in four months. Until a month ago, it reached an all-time high, but as the exchange rate rose, the balance decreased. However, the share of individual dollar deposits reached an all-time high as dollar deposits declined, mainly by companies.

According to the’Trends of Foreign Currency Deposits for Residents in January 2021′ released by the Bank of Korea on the 18th, the balance of foreign currency deposits for residents at the end of last month was $89.38 billion, a decrease of $4.82 billion from a month ago. Foreign currency deposits increased from September last year ($85.45 billion) to December, and then decreased in four months last month.



An employee is looking at US dollars at Hana Bank’s counterfeiting office in Jung-gu, Seoul./Yonhap News

Foreign currency deposits for residents are the sum of domestic foreign currency deposits held by Koreans and domestic companies, foreigners who have lived in Korea for more than 6 months, and foreign companies that have entered the country.

Dollar deposits decreased by $3.88 billion to $76.16 billion. In particular, it declined mainly in corporate deposits. At the end of last month, the company’s dollar-denominated deposit balance fell by $3.83 billion to $58.43 billion. Corporate deposits accounted for most of the total dollar savings decline. This is because, as companies paid the payment for import payments and the KRW-dollar exchange rate rose 32.5 won from 1186.3 won at the end of December to 1118.8 won at the end of January, spot exchange sales occurred.

On the other hand, personal dollar deposits decreased by only $50 million to $17.3 billion. Even though the exchange rate rose, individual demand for foreign exchange gains was not large. Accordingly, the share of individual dollar deposits in total dollar deposits reached a record high of 23.3%.

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