South Korean exports in September rose a stronger-than-expected 18.7 percent from a year earlier to a record, the fastest pace in 10 months, government data showed on Saturday, bolstering expectations for an interest rate rise.
Exports rose to a provisional $24.72 billion in September from $20.83 billion a year before, while imports increased 24.5 percent to $22.65 billion from $18.19 billion, the commerce ministry said in a statement.
The annual exports growth was the highest since a 26.5 percent rise in November last year and compared with the median forecast from a Reuters poll of eight economists for a 15.1 percent gain. Imports had been forecast to grow 20.6 percent.
"The data indicates exports could have grown by more than 20 percent if not for strikes at auto makers, and this is of course positive to those advocating an interest rates hike," said Oh Suk-tae, an economist at Citigroup.
Sharp growth in mobile phone exports amid the recovering global information technology industry led the month's total sales abroad, more than offsetting a drop in auto exports due to strikes by unionised workers, the commerce ministry said. It did not give detailed export figures by product.
Unionised workers at the country's top auto maker, Hyundai Motor Co Ltd, and its affiliate Kia Motors Corp had stopped work for several hours each day between late August and early September.
Investors have been anticipating the first rise in South Korean interest rates since May 2002 as early as this month after the central bank governor said in September that a rate rise would be seriously considered at an October 11 policy meeting.
The trade figures came a day after brisk service-sector output data for August, which analysts said had raised the chances of an interest rate rise.
The Bank of Korea cut the overnight call rate target by one percentage point in four steps between 2003 and 2004 to a record low of 3.25 percent, and has since left the rate steady to boost domestic demand in Asia's fourth-largest economy.
Data has shown a flattening trend in South Korea's annual exports growth since February this year, after it had fallen rapidly for one year, despite expectations high oil prices and rising US interest rates would dampen demand.
The commerce ministry data showed South Korea ran a trade surplus of $2.07 billion in September, down from a $2.64 billion surplus a year before. South Korea has not had a monthly trade deficit since March 2003.
For the first nine months of this year, exports rose 12.4 percent from a year before to $207.90 billion while imports grew 16.7 percent to $190.00 billion, the data showed.
The data is not adjusted for seasonal factors but is closely watched because Korea is the first major Asian economy each month to report trade.