Current Economic Situation, February 2019
Consumption Continues to Improve,
Exports, Investment and Employment being Weak
Retail sales improved for the third consecutive month in December, however industrial production fell. Exports, investment and employment have been weak, and there are uncertainties over US-China trade relationship, Brexit negotiations and semiconductor markets.
The economy added 19,000 jobs year-on-year in January: Service jobs increased and manufacturing jobs continued to fall. The unemployment rate rose from 3.7 percent a year ago to 4.5 percent, unemployment among those aged 60 or older rising to 7.4 percent.
Consumer price inflation slowed to 0.8 percent in January, the lowest in 12 months (up 1.3% in the previous month→ up 0.8%, y-o-y) as oil product prices fell and fresh food prices became stable.
All industry production continued to fall in December (down 0.7%→ down 0.6%, m-o-m) as manufacturing decreased (down 1.6%→ down 1.4%, m-o-m). Service output continued to decline (down 0.3%→ down 0.3%, m-o-m) as information & communications services fell, as well as real estate & renting. Financial & insurance services improved.
Retail sales continued to increase in December (up 0.5%→ up 0.8%, m-o-m) as sales of durable, semi-durable and nondurable goods all increased.
Facility investment continued to fall in December (down 4.9%→ down 0.4%, m-o-m) as machinery investment declined. Construction completed rose (down 1.2%→ up 2.4%, m-o-m) as both building construction and civil engineering works improved.
In December, the cyclical indicator of the coincident composite index fell 0.2 points to 98.1, and the cyclical indicator of the leading composite index fell 0.2 points to 98.5.
Exports continued to fall in January (down 1.3%→ down 5.8%, y-o-y), despite strong cars, steel and machinery, as smartphones, computers and semiconductors decreased.
In January KOSPI rose on expectations that the US and China would reach an agreement on trade issues. The dollar-won exchange rate fell as Fed slowed its rate hike, and government bond yields were mixed.
Housing prices went down in January (down 0.01%→ down 0.15%, m-o-m) as the prices fell in the Seoul metropolitan area, as well as outside the Seoul metropolitan area. Jeonse (lump-sum deposits with no monthly payments) prices continued to decline (down 0.19%→ down 0.22%, m-o-m) nationwide.
Expansionary fiscal policies and strong consumption are positive aspects, but job markets have been weak, and there are external uncertainties, such as slowing global economies and volatility in global financial markets.
The government will strengthen its risk management and work to boost the economy by promoting industrial innovation and job creation. The government will fast implement the 2019 economic policies, drawn up to help achieve an inclusive and dynamic economy, and will work on measures to improve exports.
Key Statistics
Employment
|
|
2016
|
2017
|
2018
|
2019
|
|
Annual
|
Q3
|
Q4
|
Annual
|
Q1
|
Q2
|
Q3
|
Q4
|
Jan
|
Jan
|
|
Number of employed (million)
|
26.41
|
26.73
|
27.00
|
26.88
|
26.82
|
26.28
|
27.02
|
27.02
|
26.97
|
26.21
|
26,23
|
|
Employment rate (%)
|
60.6
|
60.8
|
61.4
|
61.0
|
60.7
|
59.6
|
61.2
|
61.1
|
60.9
|
59.5
|
59.2
|
|
(Seasonally adjusted)
|
60.6
|
60.8
|
60.8
|
60.9
|
60.7
|
60.9
|
60.7
|
60.5
|
60.7
|
61.1
|
60.7
|
Consumer Price Index
|
|
2018
|
2019
|
|
Jan
|
Feb
|
Mar
|
Apr
|
May
|
Jun
|
Jul
|
Aug
|
Sep
|
Oct
|
Nov
|
Dec
|
Jan
|
|
y-o-y
|
0.8
|
1.3
|
1.2
|
1.5
|
1.5
|
1.5
|
1.1
|
1.4
|
2.1
|
2.0
|
2.0
|
1.3
|
0.8
|
|
m-o-m
|
0.4
|
0.8
|
-0.1
|
0.2
|
0.0
|
-0.2
|
-0.2
|
0.9
|
0.8
|
-0.2
|
-0.7
|
-0.3
|
-0.1
|
Mining and Manufacturing Production
(q-o-q, m-o-m, %)
|
Mining and Manufacturing2
|
2017
|
2018
|
|
Annual
|
Q4
|
Dec
|
Annual¹
|
Q3
|
Q4¹
|
Nov¹
|
Dec¹
|
|
Mining
|
(q-o-q, m-o-m)
|
-
|
-1.0
|
-2.0
|
-
|
0.6
|
-0.8
|
-1.6
|
-1.4
|
|
(y-o-y)
|
1.9
|
-3.8
|
-4.8
|
0.3
|
-1.8
|
4.7
|
1.1
|
1.6
|
|
Manufacturing
|
Production
|
(q-o-q, m-o-m)
|
-
|
-1.1
|
-2.5
|
-
|
0.3
|
-0.8
|
-1.6
|
-1.8
|
|
(y-o-y)
|
1.6
|
-4.8
|
-6.2
|
0.1
|
-2.3
|
5.0
|
1.3
|
2.0
|
|
Inventory³
|
8.8
|
2.9
|
1.2
|
7.3
|
-2.6
|
4.8
|
1.8
|
2.2
|
|
Shipments
|
0.7
|
0.4
|
-3.8
|
-1.1
|
0.9
|
-1.2
|
-2.6
|
-1.6
|
|
Average operation ratio
|
72.6
|
71.8
|
70.3
|
72.9
|
74,2
|
73.4
|
73.1
|
72.7
|
|
Production capacity (y-o-y)
|
1.1
|
-0.1
|
-0.5
|
-1.1
|
-1.5
|
-1.4
|
-1.3
|
-1.3
|
1. Preliminary
2. Including mining, manufacturing, electricity and gas industry
3. End-period
Service Output
(q-o-q, m-o-m, %)
|
|
2016
|
2017
|
2018
|
|
Annual
|
Annual
|
Q3
|
Q4
|
Annual¹
|
Q1
|
Q2
|
Q3
|
Q4¹
|
Nov¹
|
Dec¹
|
|
Service
activity index
|
2.6
|
1.9
|
0.9
|
0.2
|
2.0
|
1.0
|
0.2
|
0.1
|
0.5
|
-0.3
|
-0.3
|
1. Preliminary
Retail Sales
(q-o-q, m-o-m, %)
|
|
2016
|
2017
|
2018
|
|
Annual
|
Annual
|
Q3
|
Q4
|
Annual¹
|
Q1
|
Q2
|
Q3
|
Q4¹
|
Nov¹
|
Dec¹
|
|
Retail sales
|
3.9
|
1.9
|
0.2
|
0.9
|
4.2
|
3.0
|
0.7
|
-0.5
|
-0.5
|
0.5
|
0.8
|
|
(y-o-y)
|
-
|
-
|
3.2
|
2.1
|
-
|
5.0
|
4.7
|
3.9
|
2.9
|
1.0
|
3.0
|
1. Preliminary
Facility Investment Index
(q-o-q, m-o-m, %)
|
|
2016
|
2017
|
2018
|
|
Annual
|
Annual
|
Q3
|
Q4
|
Annual¹
|
Q1
|
Q2
|
Q3
|
Q4¹
|
Nov¹
|
Dec¹
|
|
Facility investment index
|
-1.3
|
14.1
|
0.2
|
-1.7
|
-4.2
|
8.4
|
-11.0
|
-6.2
|
0.8
|
-4.9
|
-0.4
|
|
y-o-y
|
-
|
-
|
20.6
|
2.0
|
-
|
9.4
|
-5.9
|
-13.6
|
-5.9
|
-9.3
|
-14.5
|
1. Preliminary
Construction Completed
(q-o-q, m-o-m, %)
|
|
2016
|
2017
|
2018
|
|
Annual
|
Annual
|
Q3
|
Q4
|
Annual¹
|
Q1
|
Q2
|
Q3
|
Q4¹
|
Nov¹
|
Dec¹
|
|
Construction completed (constant)
|
15.4
|
10.1
|
-0.3
|
-0.1
|
-5.1
|
2.5
|
-4.9
|
-4.4
|
-3.9
|
-1.2
|
2.4
|
|
y-o-y
|
-
|
-
|
12.7
|
-0.5
|
-
|
1.5
|
-3.4
|
-9.8
|
-7.8
|
-10.4
|
-9.5
|
1. Preliminary
Composite Indices of Coincident and Leading Indicators
|
|
2018
|
|
May
|
Jun
|
Jul
|
Aug
|
Sep
|
Oct
|
Nov¹
|
Dec¹
|
|
Cyclical indicator of coincident composite index
|
99.6
|
99.4
|
99.1
|
98.9
|
98.6
|
98.5
|
98.3
|
98.1
|
|
(m-o-m, points)
|
-0.1
|
-0.2
|
-0.3
|
-0.2
|
-0.3
|
-0.1
|
-0.2
|
-0.2
|
|
Cyclical indicator of leading composite index
|
100.1
|
100.0
|
99.8
|
99.4
|
99.2
|
98.9
|
98.7
|
98.5
|
|
(m-o-m, points)
|
0.0
|
-0.1
|
-0.2
|
-0.4
|
-0.2
|
-0.3
|
-0.2
|
-0.2
|
1. Preliminary
Exports and Imports
(US$ billion, y-o-y, %)
|
|
2016
|
2017
|
2018
|
2019
|
|
Annual
|
Annual
|
Annual
|
Q1
|
Q2
|
Q3
|
Q4
|
Nov
|
Dec
|
Jan
|
Jan¹
|
|
Exports
|
495.43
|
573.69
|
605.17
|
145.06
|
151.62
|
153.65
|
154.84
|
51.58
|
48.38
|
49.22
|
46.35
|
|
(y-o-y)
|
-5.9
|
15.8
|
5.5
|
9.8
|
3.1
|
1.7
|
7.9
|
3.8
|
-1.3
|
22.3
|
-5.8
|
|
Average daily exports
|
1.81
|
2.13
|
2.24
|
2.17
|
2.30
|
2.28
|
2.23
|
2.15
|
2.15
|
2.05
|
1.93
|
|
Imports
|
406.19
|
478.48
|
535.17
|
132.39
|
133.14
|
130.32
|
139.32
|
46.81
|
44.04
|
45.79
|
45.02
|
|
(y-o-y)
|
-6.9
|
17.8
|
11.8
|
13.7
|
13.0
|
7.8
|
12.9
|
11.4
|
1.2
|
21.6
|
-1.7
|
|
Average daily imports
|
1.49
|
1.78
|
1.98
|
1.98
|
2.02
|
1.93
|
2.00
|
1.95
|
1.96
|
1.91
|
1.88
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
1.Preliminary
Please refer to the attached PDF
