South Korea’s exports expected to grow in single digits in July while inflation rises to the highest level in 24 years

Export growth in South Korea is expected to increase in July, while consumer inflation is expected to rise to its highest level in 24 years.

Outbound exports are expected to rise 9.4% in July from a year earlier, following a 5.2% increase in June. Exports had grown at the slowest pace in a year and a half in June as rising inflation depressed demand for Korean goods abroad.

Analysts had forecast that growth would likely slow in the face of weaker international demand, rising inflation, and tight money due to COVID-related restrictions in China.

South Korea’s exports rose 14.5% year-on-year in the first 20 days of this month. However, exports to China, South Korea’s largest trading partner, fell by 2.5% after declining by 0.8% in June.

Imports are expected to increase by 20.7% in July, slightly faster than the previous month (19.4%), leading to a trade deficit for the fourth consecutive month.

The consumer price index rose 6.3% in July from a year earlier. This increase accelerated from the 6% rise reported in June, which was the highest level since November 1998.

Industrial production is expected to fall by a seasonally adjusted 0.4 percent in June compared with the previous month. This follows a 0.1 percent increase in May.

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