Korea Business Confidence


Business confidence wanes after three consecutive improvements

The Bank of Korea's (BoK) forward-looking Business Survey Index (BSI) on business conditions in the manufacturing sector fell from 83 points in November to 78 points in December. This marked the first drop after three consecutive months of improvement. The indicator, which is now at its lowest point in four months, remains below the 100-point threshold that separates pessimistic from optimistic territory.

December's decrease was broad-based and mainly reflects deteriorating business prospects for both locally-oriented and export-oriented businesses. Moreover, businesses were more pessimistic regarding lower sales prices, which resulted in lower expected earnings. The BSI's current business situation indicator showed that business sentiment in the manufacturing sector fell from 81 points in October to 78 points in November.

FocusEconomics Consensus Forecast panelists 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%, which is unchanged from last month's estimate.

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Korea Business Confidence Chart

Korea Business Confidence December 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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