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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.”

FocusEconomics Consensus Forecast panelists expect fixed investment to expand 3.4% in 2015, which is down 0.2 percentage points from last month’s forecast. In 2016, the panel expects growth in fixed investment to increase 3.5% which is down 0.1 percentage points from last month’s estimate.


Author:, Economist

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Korea PMI November 2015

Note: Nikkei Korea Purchasing Managers’ Index (PMI). A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction.
Source: Nikkei and Markit


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