August exports jump 68.7% on-year as Q2 private consumption improves
High oil prices stoke price pressures; youth employment rate falls for 28th month
The government said improvements in exports and domestic demand are helping South Korea's economy keep up a "solid recovery" trend. However, it said livelihood burdens remain, as consumer price growth climbed back into the 3 percent range and employment among vulnerable groups such as young people stayed weak.
The Ministry of Economy and Finance released its September 2026 Green Book on recent economic trends Friday. It said, "The Korean economy has recently shown a solid recovery trend, with exports increasing sharply and domestic demand, including consumption, continuing to improve."
Exports led the recovery. August exports totaled $98.26 billion, up 68.7 percent from the same month last year. Average daily exports, adjusted for the number of working days, also rose 72.5 percent to $4.47 billion.
By item, computer exports jumped 419 percent and semiconductor exports rose 209 percent. Cosmetics increased 52 percent, secondary batteries 24 percent and biohealth products 22 percent, while automobile exports fell 30 percent and shipbuilding exports dropped 46 percent. By region, exports to China rose 119.3 percent, to the United States 89.3 percent and to the ASEAN bloc 75.4 percent.
August imports rose 22.5 percent to $63.51 billion, leaving a trade surplus of $34.75 billion.
Domestic demand also continued to improve. Private consumption in the second quarter rose 0.4 percent from the previous quarter and 2.4 percent from a year earlier. Monthly consumption indicators, however, showed some softening. Retail sales in July fell 2.4 percent from the previous month, as sales of durable, semi-durable and nondurable goods all declined. Sales were down 0.8 percent from the same month last year.
Durable goods sales fell 7.7 percent, with passenger car sales dropping 11.1 percent from the previous month in particular. The consumer sentiment index for August came in at 104.5, down 2.3 points from a month earlier. Domestic credit card approvals in August, however, rose 4.9 percent from a year earlier, supporting the consumption recovery.
Production indicators were mixed. All-industry output in July was flat from the previous month. Mining and manufacturing production rose 0.2 percent, while output in the services and construction sectors fell 1.3 percent and 1.1 percent, respectively. Facility investment, however, rose 7.5 percent from the previous month and 24.9 percent from a year earlier, as investment in both machinery and transportation equipment increased.
In employment, the number of people employed in August reached 29.15 million, up 184,000 from the same month last year. The pace of job growth widened by 76,000 from July's increase of 108,000. Employment in the services sector continued to grow, while declines in manufacturing and construction narrowed.
However, employment conditions in vulnerable areas such as the youth segment, manufacturing and construction remained weak. Employment among those aged 15 to 29 fell by 143,000, marking a 46th consecutive month of decline, while the youth employment rate fell for a 28th straight month.
Price pressures also grew. Consumer prices in August rose 3.1 percent from a year earlier, a faster pace than July's 2.8 percent increase. Core inflation, which excludes food and energy, rose 3.4 percent, while the cost-of-living index rose 3.2 percent.
The Ministry of Finance and Economy said, "Amid somewhat heightened uncertainty stemming from the Middle East war, livelihood burdens are persisting, including price pressures driven by high oil prices and difficult employment conditions for vulnerable groups and sectors."
The government plans to manage the supply and demand of major goods and stabilize prices of "chuseok" holiday staples. It will also push forward at a faster pace with its second-half economic growth strategy. That strategy includes a response plan for the aftermath of the Middle East war, efforts to boost the potential growth rate and measures to address economic polarization.
fact0514@heraldcorp.com
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