Korea Business Confidence


Korea: Business confidence recedes in February to 18-month low

January 30, 2015

The forward-looking business confidence indicator (BSI) for the manufacturing sector published by the Bank of Korea (BoK) fell from 77 in January to 73 in February. The deterioration erases gains from previous months and the index now sits at the lowest level since August 2013. Moreover, the index remains well below the 100-point threshold that separates pessimistic from optimistic territory.

According to the Bank, the worsening in February’s business confidence mainly reflected a significant drop in sentiment among export-oriented firms. Expectations regarding raw material purchase prices, as in terms of sales and profitability prospects, also weakened compared to the previous month. Domestic-oriented firms were also slightly more pessimistic than in the previous month.

Meanwhile, the BSI’s current business conditions index in January held at December’s 73 points.

FocusEconomics Consensus Forecast panelists expect fixed investment to expand 4.2% in 2015, which is up 0.4 percentage points from last month’s forecast. For 2016, the panel expects growth in fixed investment to moderate to 4.0%.

Author:, Economist

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Korea Business Confidence Chart

Korea Business Confidence February 2015

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

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