South Korea May exports worst in six years

South Korean exports in May suffered their worst annual fall in nearly six years partly hurt by a persistent slowdown in China, its biggest export market, heightening pressure on policy makers to cut interest rates again. The gloomy shipments data join poor results from a private-sector survey on the manufacturing sector, which analysts say don't square with the central bank's forecast for a pick-up in economic growth in the current quarter.
"As external weakness filters through the domestic economy, downside risks to the Bank of Korea's economic outlook grow," said Ronald Man, economist at HSBC in Hong Kong. "This suggests the monetary easing cycle is not over," Man said, predicting the central bank would cut its policy interest rate to all-time lows of 1.50 percent in the next quarter following a surprise 25-basis-point cut to 1.75 percent in March. The trade ministry said on Monday that exports by Asia's fourth-largest economy fell 10.9 percent in May from a year earlier, the biggest drop since a 20.9 percent slump in August 2009 during the height of the global financial crisis.