South Korean consumer prices climbed at the slowest pace in 14 months in April on easing oil prices. Signaling a possible end to the current downturn, the trade surplus increased further to a record high, official reports showed Friday.
Annual inflation came in at 3.6% in April, slowing from 3.9% in the previous month, the National Statistical Office reported. The annual rate of increase matched economists' expectations.
Core inflation that excludes food and energy eased to 4.2% from 4.5% in March. Thus, core annual inflation reached the lowest since May 2008, when it stood at 3.9%.
Month-on-month, the consumer price index was up 0.3% in April compared to a 0.7% rise in March.
Elsewhere, a report from the Ministry of Knowledge Economy said the nation registered a record surplus of US$6.02 billion in April, despite the ongoing downturn in overseas shipment. The surplus stood at US$4.29 billion in March.
According to the Ministry, exports decreased in April due to weakening demand from abroad, but the rate of decline was less than expected. Exports dropped 19% to US$30.6 billion and imports totaled US$24.6 billion, down 35.6% from April 2008.
Economists had expected an 23.2% year-over-year drop in exports and a 36.2% decline in imports. In March, exports had slipped 22% and imports by 35.9%.
Shipments to the U.S. and Japan were down in the range of 19% to 34% on a yearly basis during the first 20 days of April. Meanwhile, exports to the European Union slid 1%. On the other hand, a surge of 110.3% was witnessed in exports to the Oceania region.
The current account posted a record US$6.65 billion surplus in March, the Bank of Korea said this week.
Averting a technical recession, the South Korean economy unexpectedly expanded 0.1% sequentially in the first quarter of 2009, following a 5.1% decline in the fourth quarter. Household spending rose 0.4%, while government expenditure grew 3.6%.
The central bank expects the economy to contract 2.4% this year, which would be the first GDP fall since 1998. The economy is expected to recover in 2010, by rising 3.5%.
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