Merchandise exports decline in May

Latest reading: Merchandise exports decreased 1.3% on an annual basis in May (April: +3.5% yoy), marking the first decline in exports since January. The drop was largely due to the impact of U.S. President Donald Trump's tariffs increase: Shipments to the US plunged amid weak performance in the automotive sector, which was hit by Trump’s 25% tariffs. However, semiconductor exports—the country’s main export item—grew by more than 20%, driven by surging global AI demand. Meanwhile, merchandise imports fell 5.3% in annual terms in May (April: -2.7% yoy). As a result, the merchandise trade balance improved from the previous month, recording a USD 6.9 billion surplus in May (April 2025: USD 4.9 billion surplus; May 2024: USD 4.9 billion surplus). Lastly, the trend pointed up, with the 12-month trailing merchandise trade balance recording a USD 56.1 billion surplus in May, compared to the USD 54.0 billion surplus in April.

Panelist insight: Nomura’s Jeong Woo Park said: “May’s export data support our view of resilient exports despite the tariff shock. […] In our view, the path of exports in coming months will likely be determined by two contrasting forces: a slowdown in the sectors affected by tariffs particularly auto vehicles and parts) and robust growth in AI-related exports (chips and computing equipment). We eiterate our view that stronger AI demand and a likely better tariff deal (tariff exemption on chips and tech) are likely to support a gradual recovery in exports, led by chips amid NVIDIA ramping up shipments of its Blackwell products.”

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