Korea Business Confidence November 2018

Korea

Korea: Forward-looking business confidence falls for November

October 30, 2018

The Bank of Korea’s forward-looking business confidence indicator (BSI) for the manufacturing sector has registered pessimism among businesses for every month since June 2011. For November 2018, the indicator fell to 72 points from 78 points for October. This left the BSI below both the 100-point threshold—signaling another month of pessimism—and the long-run average reading of 86 points.

A breakdown of the BSI components showed that, for November, businesses were more downbeat about sales and profitability prospects than they were for October. In terms of sales prices specifically, firms were just as pessimistic about prospects for November as they were for October. However, the one area in which businesses felt more upbeat was raw material purchase prices, as they registered a small increase in optimism for November. Meanwhile, confidence among non-manufacturing businesses—the mainstay of the Korean economy—fell from 77 points for October to 75 points for November.

FocusEconomics Consensus Forecast panelists expect fixed investment to expand 1.9% in 2019, which is down 0.5 percentage points from last month’s forecast. In 2020, the panel expects fixed investment to grow 2.3%.


Author:, Economist

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Korea Business Confidence November 2018

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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