Korea: PMI stagnates in contractionary territory in November
December 1, 2015
The manufacturing Purchasing Managers’ Index (PMI) came in at 49.1 in November, according to a release provided by Nikkei in collaboration with Markit. The result was unchanged from the 49.1 tallied in October. The index has improved since hitting a record-low in June, but remains below the 50-threshold that separates contraction from expansion.
November’s result reflected ongoing weakness in production levels and new orders. Production declined for the ninth straight month, which marks the longest period of contraction in more than five years. Output continues to register losses amid global economic uncertainty and sluggish demand. New orders were also down in November, although the rate of contraction was the slowest in nine months. New export orders fell at the sharpest rate since June due partly to diminished trade with China and Europe. Given the challenging environment, manufacturers’ reduction in purchasing activity was the sharpest in three months. However, employment levels increased for the first time since March.
Overall, Markit analysts emphasized that, “operating conditions in the South Korean manufacturing sector continued to worsen at a weak rate in November.”
Author: Carl Kelly, Economist