October Trade Statistics

◆In the October 2013 Trade Statistics (Ministry of Finance), export value posted a y/y advance for the eighth month in a row (up 18.6%), overshooting the market consensus (up 16.2%). Breaking down export value, export price remains on a strong uptrend (up 13.6%) and export volume saw the first gain in two months (up 4.4%), pushing up export value. On a seasonally adjusted m/m basis, export value posted the first gain in two months (up 1.5%), while it posted the 11^th consecutive gain on a three-month moving average basis, indicating that the underlying uptrend continues.

◆The Export Volume Index (seasonally adjusted by DIR) posted the first m/m gain in two months (up 1.1%). By trading partner, exports to the EU declined, while those to the US and Asian trading partners increased, pushing up the headline index. Underlying export volume to the EU began to firm up but has lost momentum, perhaps temporarily, as the EU economy bottomed out, but the recovery pace is showing signs of slowing. Exports to the US and Asian trading partners have been on an advance-retreat trend. As a whole, export volume has leveled off.

◆The US and EU economies are expected to continue growing, and emerging economies are likely to stabilize amid a cooling down of currencies of emerging market economies. We anticipate export volume to return to an uptrend.