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KRW
South Korea's first 10 days trade data for May showed similar trends to last month, with a further easing in export momentum and an on-going trade deficit observed.
- First 10 day exports were +28.7% YoY, but on a daily average basis it was just +8.9% YoY. Note that for April export growth was +12.6% YoY for the full month. So early trends for May look to be a continuation of the easing trend.
- The details were mixed, chip exports holding up at close to +11% YoY, but mobile devices declined. Petroleum exports also surged. Export growth was stronger to the US and EU compared with China.
- Imports increased at a firmer pace, up +34.7% YoY, leaving the trade deficit at -$3.72bn for the first 10 days of the month. This can obviously improve through the course of the month, but the trend still looks an unfavorable one, see the chart below.
- Spot USD/KRW is slightly higher in early trade, up to 1,279, while the 1 month NDF is just above 1,280, which is above recent cyclical highs. Watch for comments by the authorities around excessive volatility.
Fig 1: South Korean Trade Deficit Remains A Headwind For The Won
Source: MNI - Market News/Bloomberg
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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