Korea: Manufacturing PMI improves in December for the first time since April 2019
January 2, 2020
The IHS Markit manufacturing Purchasing Managers’ Index (PMI) ticked up from 49.4 in November to 50.1 in December, slightly higher than the 50-threshold that separates an improvement from deterioration in the manufacturing sector over the previous month.
The slight improvement in December was driven by an increase in output and new orders. Moreover, new export orders strengthened in December, posting the strongest reading since June 2018. Meanwhile, business sentiment improved among Korean manufacturers likely due to improving global manufacturing conditions and anticipation of new product launches. On the price front, both input and output prices increased in December.
Commenting on December’s result, Joe Hayes, IHS Markit economist, noted:
“Key to the reversal of the negative trend seen through most of 2019 seems to be new product launches, particularly in the automotive and electronic sectors. Survey data showed that businesses anticipate 2020 to be more positive, as signalled by higher input purchasing and stockpiling."
Author: Steven Burke, Economist