Korea Business Confidence


Business confidence drops to four-month low in July

The Bank of Korea's (BoK) forward-looking Business Survey Index (BSI) on business conditions in the manufacturing sector fell from 82 points in June to 78 points in July, marking the lowest level in four months. For over two years, the index has remained below the 100-point threshold that marks the separation between pessimistic and optimistic territory.

The deterioration was due to worsening prospects for export-oriented industries, partly as a result of the recent appreciation of the won against the Japanese yen stemming from Japan's massive monetary easing. Expectations on domestic demand-oriented growth decreased and prospects for sales and profitability deteriorated.

The BSI's index on current business perceptions showed the manufacturing sector edging down from 80 points in May to 79 points in June, amid a worsened assessment of export conditions.

FocusEconomics Consensus Forecast panellists expect fixed investment to expand 2.0% in 2013, which is down 0.2 percentage points from last month's forecast. In 2014, the panel expects fixed investment to accelerate to 3.9%.


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Korea Business Confidence Chart

Korea Business Confidence July 2013

Note: Business Survey Index (BSI). An index value above 100 indicates an optimistic outlook while a value below 100 indicates a pessimistic outlook.
Source: Bank of Korea (BoK).

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