South Korea recorded its longest string of trade deficits since the Asian financial crisis in 1997, as elevated energy and commodity prices resulted in imports continuing to outpace exports.
The deficit was US$3.77 billion last month, the sixth straight monthly shortfall, according to data released on Saturday by the South Korean Ministry of Trade, Industry and Energy.
Imports climbed 18.6 percent from a year earlier, while exports advanced 2.8 percent, it said.
Export-dependent nations are seeing persistent trade shortfalls this year as Russia’s war on Ukraine leads to higher energy and commodity prices and exacerbates inflationary pressures.
South Korea’s deficit hit a record in August, and its weakening currency further increases troubles for manufacturers.
The nation produces key items such as microchips, vehicles, displays and smartphones, and its shipments demonstrate demand at a time when concerns are mounting about a global recession.
Inflation remains elevated worldwide, prompting central banks to tighten policy rates irrespective of economic costs. South Korean chipmakers in August slashed production for the first time in more than four years to brace for a deterioration in demand.
Resilient export growth has been a major factor bolstering the confidence of Bank of Korea board members to keep raising rates. Governor Rhee Chang-yong is keeping the door open for another hike at an Oct. 12 meeting.
The latest trade data showed that exports to China fell 6.5 percent, and those to the EU were down 0.7 percent last month. Shipments to the US gained 16 percent, while those to Japan increased 2.5 percent, the government data showed.
Total semiconductor shipments decreased 5.7 percent last month from a year earlier, while total automobile shipments advanced 34.7 percent and exports of rechargeable batteries rose 30.4 percent.
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