Korea’s Exports Gain in Early Trade Data Despite Virus Surge

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South Korea’s early trade data showed exports continuing to rise in December despite a raging pandemic, though the pace of gains slowed as some countries placed stricter curbs on activity.

Exports edged up 1.2% in the first 20 days of the month from a year earlier, the customs office reported Monday. Average daily shipments increased 4.5% in the period, which had one less business day compared with last year, a slightly slower pace than the 6.3% daily gain in the full November trade figures.

The report, closely watched as an early indicator of global trade, suggests rampant infections haven’t had a major impact on overseas demand so far. While the figures suggest the speed of recovery could be slowing a touch for now, economists warned against reading too much from the relatively small changes in the partial data.

Korea’s Exports Gain in Early Trade Data Despite Virus Surge

The start of vaccinations in some countries is raising optimism that global commerce will gather pace in the coming months, though the recovery is likely to be uneven and drawn out until the shots can be administered widely.

“Covid-19 is having some impact, but that impact should remain limited since momentum in global manufacturing is continuing to fuel demand for capital and intermediate goods that make up the bulk of Korean exports,” said Kim Jin-myoung, an economist at Hanwha Investment & Securities Co.

It is still too early to draw hard conclusions from the data with another 10 days of figures yet to come and with a difference in working days also affecting the numbers, Kim added.

South Korea is pinning hopes on an exports recovery to ease the hit to growth from the country’s latest virus wave. The government expects a boom in the chip industry to enable an 8.6% increase in exports next year, with consumption growing at a modest 3.1%.

The latest data showed the value of semiconductor shipments increased 26%. Exports of wireless communications devices rose 38%. Heading in the other direction, car exports fell 3.5% and oil product shipments decreased by 50%.

Exports to China, South Korea’s largest overseas market, fell 2.3% between Dec. 1-20 from a year earlier, for the first fall in two months.

Shipments to the U.S. edged up 0.7%, while exports to the European Union rose 15% and those to Japan dropped 10%.

South Korea’s overall imports fell 8% in the first 20 days of December.

©2020 Bloomberg L.P.

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