Investment in Korea
Korea - Investment
Second estimate confirms a sharp contraction in the first quarter
According to a second GDP release from the Bank of Korea, the economy contracted 1.3% in quarter-on-quarter seasonally-adjusted (qoqsa) terms in the first quarter, contrasting the 1.3% expansion in the final quarter of last year and slightly softer than the first estimate of a 1.4% decline. Moreover, the economy grew 1.4% in annual terms in Q1, down notably from 2.3% in the final quarter of last year, but up slightly from the 1.3% expansion previously estimated by the BOK.
The largest drop-off in private consumption since the Asian Financial crisis over two decades ago primarily drove the sharp deterioration in the first quarter (Q1: -6.5% qoq s.a.; Q4: +0.7% qoq s.a.). Moreover, government consumption growth slowed from 1.8% in Q4 last year to 1.4% in Q1, while gross fixed capital formation also softened from 4.7% growth in Q4 to 0.5% growth in Q1.
On the external front, exports of goods and services declined 1.4% quarter-on-quarter, contrasting the previous quarter’s 0.6% expansion. Similarly, imports of goods and services contracted 3.6% in the first quarter, contrasting the fourth quarter’s 0.4% increase.
In May, the Bank of Korea projected the economy would decrease 0.2% in 2020. Meanwhile, last month FocusEconomics panelists penciled in a contraction of 1.1% in 2020, which was down 0.3 percentage points from the prior month’s estimate. In 2021, our panelists saw the economy growing 3.2%.
Korea - Investment Data
| 2014 | 2015 | 2016 | 2017 | 2018 | |
|---|---|---|---|---|---|
| Investment (annual variation in %) | 3.1 | 5.4 | 6.6 | 9.8 | -2.4 |
Korea Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 1.68 | 1.55 % | Dec 31 |
| Exchange Rate | 1,156 | 0.21 % | Dec 31 |
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Economic News
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Korea: Second estimate confirms a sharp contraction in the first quarter
June 2, 2020
According to a second GDP release from the Bank of Korea, the economy contracted 1.3% in quarter-on-quarter seasonally-adjusted (qoqsa) terms in the first quarter, contrasting the 1.3% expansion in the final quarter of last year and slightly softer than the first estimate of a 1.4% decline.
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Korea: Manufacturing PMI ticks down in May
June 1, 2020
The IHS Markit manufacturing Purchasing Managers’ Index (PMI) ticked down to 41.3 in May from 41.6 in April, moving slightly further below the 50-threshold that separates an improvement from a deterioration in the manufacturing sector over the previous month. May’s print was driven by the second sharpest fall in output since January 2009 easing a notch from April, due to weak demand, particularly from abroad.
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Korea: Exports continue to plummet in May
June 1, 2020
Merchandise exports plunged 23.7% year-on-year in May, less steep than the 24.4% drop recorded in April, totaling USD 34.9 billion in May (April: USD 36.6 billion).
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Korea: Industrial output falls at sharpest rate since September 2018 in April
May 29, 2020
Industrial production fell 4.5% year-on-year in April (March: +7.4% yoy).
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Korea: Forward-looking manufacturing business confidence ticks down in June
May 29, 2020
The Bank of Korea’s forward-looking business confidence indicator for manufacturers decreased to 49 in June from 50 in May, marking the lowest result since February 2009.
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