Korea Business Confidence


Korea: Business confidence tumbles in July

June 30, 2015

The forward-looking business confidence indicator (BSI) for the manufacturing sector published by the Bank of Korea (BoK) plunged from 76 in June to 67 in July, which marked the lowest level in more than two and a half years. Moreover, the index is now even further below the 100-threshold that separates pessimistic from optimistic territory.

According to the Bank, the steep deterioration in business confidence in July reflected much weaker sentiment among both domestically and export-oriented firms. Expectations regarding sales also suffered a large drop. Businesses’ outlook in terms of profitability and sales were also down, although to a lesser degree.

Meanwhile, the BSI’s current business conditions index slumped from 73 in May to 66 in June.

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 July 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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