South Koreans Flock to Dollar Deposits Amid Semiconductor Export Boom

South Korean residents increased their foreign currency deposits by over $1 billion in June, marking the largest gain in four months. The total resident foreign currency deposits at domestic banks reached $113.33 billion at the end of June, a rise from $112.25 billion in May.

The surge was primarily driven by hefty semiconductor export proceeds and rising funds parked for overseas stock investments. U.S. dollar deposits saw a significant increase, surging to a record $97.8 billion, accounting for 86.3% of total foreign currency deposits.

According to the Bank of Korea, larger customer deposits at securities firms contributed to the rise, including margin collateral for exchange-traded derivatives and funds earmarked for overseas equity investments, as well as export payments received by large corporations.