South Korea's Export Growth Is at 13-Month Low

South Korea's exports growth in October fell to a 13-month low and missed market expectations, data showed on Monday, adding to concerns that a global economic slowdown is denting the country's overseas sales.

CNBC.com

Imports of Asia's fourth-largest economy in October also grew by the slowest in 13 months as oil prices eased, which helped the country post its first trade surplus in five months, the Ministry of Knowledge Economy said in a statement.

Exports in October grew 10.0 percent from a year earlier, the slowest since September 2007 when the country's overseas sales fell 1.1 percent from a year ago.

That missed a 14.4 percent growth forecast by a Reuters poll of 11 economists and compared with a 28.2 percent annual rise in September and a 18.2 percent gain in August.

"Exports to developed economies slowed sharply reflecting an economic slowdown," the ministry said. "Sales to developing countries in Asia also fell by a large margin."

The data came ahead of a scheduled interest rate-setting meeting on Friday by the Bank of Korea. The central bank last week cut its policy rate by a record 75 basis points in an emergency meeting to fight an economic slowdown.

For the first 20 days of March, exports to China, South Korea's biggest market, fell 1.8 percent from a year ago, slowing from a 15.5 percent rise in whole of September.

Sales to the European Union slid 8.2 percent during the 20 day-period, after rising 26.7 percent in September.

Imports in October grew 12.0 percent from a year ago, the slowest annual growth since September 2007 when imports fell 1.6 percent.

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It also missed a 16.5 percent rise forecast from the Reuters poll and compared with a 45.8 percent surge in September and 36.4 percent growth in August.

With a slower growth in imports, South Korea posted a $1.22 billion trade surplus in October, the first surplus since a $701 million surplus in May this year.

The country posted trade deficits in eight months of the year.

The ministry said it expected the South Korea to continue to post monthly trade surpluses for the rest of the year as weaker oil and raw material prices are likely to offset slowing export growth.

The government has forecast South Korea would report its first annual trade deficit this year since the 1997 Asia financial crisis.

South Korea is the first big Asian economy to report foreign trade data each month, providing clues on global merchandise demand for the rest of Asia.

The data was released before South Korea's financial markets opened on Monday.

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