South Korean exports in December are likely to increase less than in the previous month due to cooling demand from major economies led by China, a Reuters survey found yesterday.
The median forecast from 10 economists polled was a 3.3% rise in exports from a year earlier, down from 4.1% growth in November and below a 6.2% gain for the first 11 months of this year.
Imports are seen rising 4.2% in December from a year earlier, sharply down from November’s 11.5% increase. If December exports match the poll forecast, there will be growth of 5.9% for the year, way below 2017’s gain of 15.8%.
The finance ministry sees export growth slowing to 3.1% next year. Analysts said recent declines in prices of key South Korean export items, such as memory chips and oil products, could lead to annual declines export value early in the new year.
“Falling semiconductor prices and global oil prices could lead to contraction in South Korean exports in the first quarter,” said Lee Seung-hoon, an economist at Meritz Securities.
South Korea is the world’s leading exporter of chips, and a major source of ships, cars and petroleum products.
It is the first major exporter to report monthly trade data, which provides an early reading of global trade conditions.
For the first 20 days of December, South Korea’s overseas sales of memory chips fell by 9.8% in value from a year earlier, according to customs agency data released earlier.
“Easing in the Sino-US trade conflict and a rebound in global oil prices are essential for sustained growth in South Korean exports,” said Lee Sang-jae, an economist at Eugene Investment & Securities.
In November, South Korea’s exports to China, its biggest trade partner, declined for the first time since October 2016 and chip exports increased the least since November 2016.
Also in the latest poll, respondents see December’s annual headline inflation rate slowing to 1.7% from November’s 2%, which matched the central bank’s target.
Industrial output in November was seen shrinking 0.2% from a month earlier versus a 1% gain in October, the poll showed. November industrial output data will be released on Friday, December inflation on December 31 and December trade figures on 
January 1.