South Korea's exports are likely to have weakened in August

South Korea's exports are likely to have weakened in August after a stable performance in July. Based on interim trade data until 20 August, it is estimated that the exports will decline from $46.6bn to $42.0bn. Temporary factors such as the summer vacation and the special holiday on 14 August to celebrate the 70th Liberation Day cannot fully explain the weakness in exports, which would be negative for the short-term growth outlook. 

Imports are likely to fall from $38.8bn in July to $36.0bn in August, mainly due to the steep decline in oil prices. The trade surplus will remain substantial at $6.0bn. The outlook for exports should depend on those to advanced economies (US and Europe), which has been slower so far this year.