Bank of Korea expects trade deficit to continue due to high oil prices

The South Korean central bank (BOK) has reported that South Korea is likely to run a trade deficit for some time. The country has been pressured by a global economic slowdown and high oil prices, with nearly 80% of the total trade deficit this year due to rising oil prices.

According to the report, South Korea recorded a trade deficit of $24.7 billion between January and August. This is a decrease of $45.4 billion compared to the same period last year.

The BOK estimates that a $10 drop in global oil prices based on annual average prices would help improve South Korea’s trade balance by about $9 billion.

The BOK’s August economic forecast also said South Korea is likely to post a trade deficit of $29 billion this year, an unprecedented result that will turn into a modest trade surplus of $1 billion next year.

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