South Korea’s export growth is expected to have slowed for a third consecutive month in October, according to a Reuters poll. The slowdown is attributed to cooling global demand for computer chips. Outbound shipments from the country are forecasted to have risen by 6.9% in October compared to the previous year. This marks the 13th straight month of annual export growth, but it is slightly weaker than the 7.5% year-on-year increase seen in September.
Economists believe that export growth is entering a slowing trend, particularly in the IT sector, as demand for non-semiconductor exports remains limited. South Korea, being the first major exporting economy to report trade figures each month, is expected to release its monthly data for October on November 1.
The country’s economy barely grew in the third quarter due to a decline in exports, which were primarily driven by semiconductor sales to the United States. A slowdown in exports, especially in the semiconductor sector, could have negative implications for the economic growth outlook.
In the first 20 days of October, exports experienced a 2.9% decrease. Shipments to the United States and the European Union declined, while those to China saw a modest increase. Analysts predict that growth in shipments to the US will slow down, and the recovery in shipments to China will be weaker than anticipated.
Imports, on the other hand, are expected to have increased by 2.0% in October following a 2.2% growth in September. The survey’s median estimate for this month’s trade balance is a surplus of $4.23 billion, down from $6.66 billion in the previous month.