Financial Wire

South Korean Imports Soar in March on Iran War Cost Pressures

-- South Korea's import prices jumped 16.1% month on month in March, according to preliminary data from the Bank of Korea released on Wednesday.

The surge is the biggest on a month-on-month basis in nearly three decades due to cost pressures stemming from the war in Iran, Bloomberg reported separately the same day.

On a yearly basis, imports jumped 18.4%, led by raw materials exports, which surged 40% year over year.

Export prices increased 16.3% on a monthly basis, according to the central bank. The rise shows broad inflationary pressure across trade flows, according to the news outlet.

The increases in both indicators also reflect a rise in crude costs coupled with a weaker won, according to Bloomberg.

Exports surged 28.7% year over year, led by a 28.7% yearly increase in manufacturing goods, the central bank said in its release.

"The outlook for consumer inflation will likely be influenced by a combination of factors, including how the conflict in the Middle East unfolds, and the effectiveness of the government's price stabilization measures," Bloomberg quoted BOK Price Statistics Chief Lee Moon-hee as saying.

South Korea's growth outlook is seen to rise 1.9% in 2026, while inflation is seen to accelerate to 2.5% this year from a previous forecast of 1.8%, according to the International Monetary Fund's World Economic Outlook.

The forecast follows the central bank's siren on an increase in price pressures, with inflation exceeding a 2.2% forecast for 2026, Bloomberg said, citing Governor Rhee Chang Yong.

The net barter terms of trade index gained 22.8% year over year in US dollar terms.

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