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Korea PMI March 2024

Korea: Manufacturing PMI declines in March

The S&P Global South Korea Manufacturing Purchasing Managers’ Index (PMI) fell to 49.8 in March from 50.7 in February. As a result, the index moved below the 50.0 no-change threshold, and signaled a deterioration in manufacturing sector operating conditions compared to the previous month.

The latest PMI reading was driven by a slight reduction in output levels and a renewed decrease in total new orders, marking the first contractions in both components since December. However, new export orders expanded for a third consecutive month, supported by stronger demand in south-east Asia and Japan. Moreover, South Korean manufacturers continued to increase staffing levels and buying activity, aiming to secure safety stocks amid delivery delays and higher prices.

Meanwhile, input prices rose at the strongest rate in four months, driven by sharp increases in raw material and logistics costs, partly due to the crisis in the Red Sea. In response, manufacturers modestly raised output charges. Business sentiment improved, with manufacturers expressing optimism for a broad economic recovery, particularly domestically, and anticipating stronger demand in the semiconductor and automotive sectors.

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