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Trade terms continue to fall in April on faster export price fall

May 31, 2023

South Korea’s terms of trade worsened for the 25th straight month in April as export prices fell faster than import prices, central bank data showed Wednesday.

The country’s net terms-of-trade index for goods fell 0.5 percent last month from a year earlier, following a 5 percent dip the previous month, according to the preliminary data from the Bank of Korea.

The index is calculated by dividing the index for export prices by that for import prices. It shows the amount of imports a country can buy for each unit of exports, with a lower figure meaning worse trade terms.

April’s decline stemmed from a faster price fall in exports relative to import prices.

Export prices fell 13.2 percent on-year in April, while import prices declined 12.8 percent over the same period, the data showed.

In this file photo, containers for export are stacked at a pier in South Korea's largest port city of Busan, 320 kilometers south of Seoul, on May 10, 2023. (Yonhap)
In this file photo, containers for export are stacked at a pier in South Korea’s largest port city of Busan, 320 kilometers south of Seoul, on May 10, 2023. (Yonhap)