SEOUL, Aug 8 (Reuters) - South Korea’s exports are faring worse than initially expected as the escalation in U.S.-China trade tensions hits both prices and volumes of chip sales, the central bank said on Thursday.
The Bank of Korea also said in a scheduled monetary and credit policy report that the delayed recovery in the global chip industry would hurt the country’s exports in the coming months.
Semiconductors account for about a fifth of South Korea’s exports and plunging global chip prices have been the biggest factor behind the declines in shipments over the past eight months.
The BOK said uncertainty over future economic growth would remain elevated for the time being, with Japan’s recent export controls against South Korea adding risks to Asia’s fourth-largest economy.
The BOK delivered a surprise interest rate cut in July in its first policy easing in three years, to support economic growth. Governor Lee Ju-yeol has since made remarks indicating it could cut the rate further. (Reporting by Choonsik Yoo; Editing by Sam Holmes)