Thursday, May 1, 2008

South Korea Exports March 2008

South Korea’s exports grew at their fastest pace in more than three years in April, as strong demand from emerging markets and a weaker local currency offset the impact of a US economic slowdown. Exports, which make up about 40 per cent of South Korea’s gross domestic product, shot up 27 per cent last month from a year earlier, exceeding March’s 18.6 per cent rise, according to figures released on Thursday.

Diversified markets and export products helped Korea weather cooling demand from the US and Europe, according to the latest data.

Exports to the Middle East jumped 43.9 per cent in the first 20 days of April and those to Latin America and China climbed by 28.5 per cent and 17.9 per cent respectively, while shipments to the US and Europe fell by 0.9 per cent and 2.5 per cent respectively.

The strong rise in exports comes as a relief to the new government, which is sticking to its 6 per cent target for economic growth despite the slowing global economy. But it adds to the dilemma confronting the Bank of Korea, which is under pressure to cut interest rates to boost sluggish domestic demand even as inflation rises.

The BoK is to hold its next monetary policy board meeting May 8. Thursday‘s strong export data is expected to ease pressure for the central bank to cut rates this month as consumer prices rose 4.1 per cent in April, above its 2.5-3.5 per cent target range.