Won Decline Triggers Increase In Both Export, Import Prices

The weakening of the Korean won against the dollar raised both import and export prices, the Bank of Korea said Tuesday, but only in won terms. According to the central bank, average export prices of local products grew 1.8 percent in March over February after it declined 2 percent in February over January. The prices of imported goods on average also climbed 0.8 percent in March from February. It slipped 0.3 percent in February.

The Bank of Korea said the average export price defied price declines in key export items such as petrochemicals, semiconductors and telecommunication equipment on the global market because the won's value fell by 2.9 percent. If the effect of the exchange rate change is removed, the average export price declined 0.8 percent in March from February. Average import prices also shed 1.5 percent, mainly due to oil price declines.

"Since export prices grew at a higher rate than import prices, the average profitability of foreign trade has increased," said an official at the central bank.

by Moon So-young