SEOUL: South Korean exports in the the first weeks of September fell about 10 percent from a year ago, Reuters calculations showed on Wednesday, adding to fears of slower economic growth and putting further pressure on the already weakening won .
"It would have been a big surprise if exports didn't weaken at a time when the major economies are sending signs of slowing growth," said Jun Min-kyu, economist at Korea Investment and Securities.
"Export demand will continue to be weak for the coming months."
Exports for Sept. 1-20 fell 10.4 percent year-on-year to $26.01 billion, while imports rose 16.6 percent to $30.22 billion, generating a deficit of $4.21 billion, the calculations based on customs agency data showed on Wednesday
Economists said the findings underscored softening US and European demand, though fewer working days this year than a year ago were partly to blame for the decline in exports.
There were fewer working days this year because the three-day Chuseok Thanksgiving holidays fell in early September this year but in late September last year.
South Korea is the world's seventh-largest exporter, specialising in products ranging from semiconductors and mobile phones to cars and ships. China, the European Union and the United States are its top export markets.
The global downturn has hit Asian electronics exporters particularly hard as consumers and companies rein in their tech spending, though South Korea's auto exports have been far more resilient as cost-conscious buyers are drawn to its lower cost models.
The trade data came a day after the International Monetary Fund cut South Korea's economic growth forecast for this year to 4.0 percent from 4.5 percent, in line with lowered projections for most other economies as global demand cools
The weak trade put further pressure on the won , which had already tumbled more than 8 percent against the dollar over the past two months on worries about the global economic slowdown and financial market turmoil.
The currency briefly turned lower after the data, giving up an early rise of 0.6 percent. By 0130 GMT, it was quoted at 1,146.8 per, up 0.1 percent from the previous local close.
Investors ignored early government data showing the local employment situation improved in August, with the unemployment rate falling to a 3-year low of 3.1 percent on a seasonally adjusted basis.
South Korea's central bank held interest rates steady early this month for a third consecutive month despite a surge in inflation as the slowing economy and volatile financial markets emerged as a bigger concern for policymakers than inflation.
Copyright Reuters, 2011
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