Korea: Merchandise trade surplus widens in March
Latest reading: In March, the trade balance was USD +25.7 billion, following a USD +15.4 billion reading in the prior month. Over the last 12 months, the trade balance summed to USD +120.6 billion.
Merchandise exports were up 48.3% in year-on-year terms in March, coming on the back of a 28.7% rise in the previous month, boosted by soaring semiconductor shipments. Merchandise imports were up 13.2% in year-on-year terms in March, coming on the back of 7.5% growth in the prior month. March’s reading was the strongest since September 2022.
Panelist insight: Commenting on the outlook, Nomura’s Jeong Woo Park stated:
“The export trajectory remains strong, in our view. The chip uptrend shows no signs of peaking, and strong price effects and AI demand will continue to support a double-digit pace. Amid the Middle East conflict, there are growing concerns over supply disruption to key inputs for chip making (i.e., helium). However, chip companies hold three to six months of inventory for these key inputs, so we believe the Middle East conflict is unlikely to hit chip exports. Thus, in view of strong chip exports offsetting elevated oil prices, we expect the full-year trade surplus in 2026 to increase […]. The resulting improvement in external balances should keep financial conditions accommodative, even in the face of KRW weakness.”