South Korea's July exports outperform expectations, with semiconductors continuing to support technology exports

Overview

This report reviews South Korea's July 2026 trade data. The year-over-year growth rate of exports slowed from 70.7% in the previous month to 62.8%, but remained above the market consensus and Goldman Sachs' forecast. Seasonally adjusted exports declined 3.0% month over month, retreating from June's sharp 12.7% growth. By export composition, semiconductor exports continued to grow strongly, while non-technology exports declined due to weakness in petroleum products. Imports grew 26.5% year over year, and the trade surplus narrowed but remained at a high level.

Core views

The core view is that although South Korea's overall exports declined month over month, they outperformed expectations, with technology—particularly semiconductors—remaining the primary support. Weaker demand from the United States and ASEAN was the main drag on overall exports, while exports to the European Union and China continued to grow, indicating divergent regional performance. The trade surplus declined from its record high but remained significantly improved year over year, suggesting that external demand and the technology cycle continue to support South Korea's macroeconomic fundamentals.

Analysis framework

The report uses a monthly trade-data tracking framework, comparing year-over-year and seasonally adjusted month-over-month performance for exports, imports, and the trade balance, while decomposing contributions by product category and export destination. Goldman Sachs also compares the actual data with its own forecasts and the Bloomberg consensus to assess the direction and magnitude of the data surprise.

Methodology notes

• High-frequency macroeconomic data trackingYear-over-year and seasonally adjusted month-over-month trade data analysis

  Use year-over-year growth to measure the external-demand cycle and seasonally adjusted month-over-month changes to observe short-term momentum.

  The report uses Goldman Sachs' seasonally adjusted, non-annualized month-over-month data to assess short-term changes in South Korea's July exports and imports, while comparing year-over-year data with market expectations to determine whether the data exceeded expectations.

• Macroeconomic scoringAsia-MAP scores

  Asia macroeconomic data surprise/momentum scoring.

  The report shows an Asia-MAP score of +4 for exports and 0 for imports, indicating that export data was relatively stronger.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• South Korean macro assets

  Stronger-than-expected exports and the high trade surplus support South Korea's growth and external account.

  Strengths

  Strong semiconductor exports, overall exports above expectations, and a trade surplus still significantly higher than in the same period last year.

  Weaknesses

  Exports declined month over month, and imports also weakened, indicating that short-term trade momentum has not improved broadly.

  Comparison

  Actual export growth of 62.8% year over year was above the Bloomberg consensus of 60.6% and Goldman Sachs' forecast of 60.4%.

  Risks

  Declining demand from the United States and ASEAN and weak non-technology exports could weaken subsequent growth momentum.

• South Korean semiconductor supply chain

  Semiconductor exports were the core driver of resilience in July technology exports.

  Strengths

  Semiconductor exports grew 5.5% month over month, marking the 11th consecutive month of growth.

  Weaknesses

  Other technology exports grew only 2.6%, while flat-panel displays declined 6.5%, creating a drag.

  Comparison

  Semiconductor performance was significantly stronger than that of non-technology exports, which declined 6.8% month over month.

  Risks

  If global technology demand or the price cycle weakens, export support could diminish.

Key data

• July exports year over year+62.8%The Bloomberg consensus was +60.6%, Goldman Sachs' forecast was +60.4%, and the previous reading was +70.7%.
• July exports, seasonally adjusted month over month-3.0%Down from +12.7% in June, ending seven consecutive months of growth.
• Semiconductor exports, seasonally adjusted month over month+5.5%June was +7.2%, marking the 11th consecutive month of growth.
• Non-technology exports, seasonally adjusted month over month-6.8%Accounting for approximately half of total exports, with an 8.5% decline in petroleum products being the main drag.
• July imports year over year+26.5%Below the Bloomberg consensus of +27.9% and Goldman Sachs' forecast of +27.4%; the previous reading was +30.0%.
• July imports, seasonally adjusted month over month-1.1%Down from +8.8% in June.
• July trade balanceUS$30.3bnThe previous month was US$36.1bn, while the Bloomberg consensus was US$29.5bn.
• Exports to the United States, seasonally adjusted month over month-8.6%Together with ASEAN, contributed approximately 70% of the overall sequential decline.
• Exports to ASEAN, seasonally adjusted month over month-9.6%Regional export performance was weak.
• Exports to the European Union, seasonally adjusted month over month+17.4%Continued to grow rapidly.
• Exports to China, seasonally adjusted month over month+3.7%Growth slowed from the previous period but remained positive.

Impact & implications

The data is moderately positive for South Korea's macroeconomy and technology supply chain: continued growth in semiconductor exports reinforces the signal of an upward technology cycle, while the high trade surplus supports external-account stability. However, declines in non-technology exports and exports to the United States and ASEAN indicate that the external-demand recovery is uneven; it will be important to monitor whether technology strength can continue to offset weakness in traditional export sectors.

Risks

• Weak non-technology exports, particularly petroleum products, which were affected by price factors.
• A significant decline in exports to the United States and ASEAN, with regional demand divergence potentially persisting.
• The trade surplus narrowed from its record high; if import costs rise or external demand deteriorates, the extent of external-account improvement could decline.
• Technology exports are highly dependent on semiconductors; a slowdown in the chip cycle would weaken overall export resilience.

What to watch

• Whether semiconductor exports can maintain consecutive monthly growth in the coming months.
• Whether regional divergence in exports to the United States, ASEAN, the European Union, and China narrows.
• Price and demand changes in non-technology exports, particularly petroleum products.
• Whether the trade surplus remains above the level recorded in the same period last year.
• The implications of changes in energy, precision instruments, and electronic products within imports for domestic demand and the production chain.