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PRESS RELEASES

Current Economic Situation, August 2019

  • DivisionEconomic Policy Bureau - Economic Analysis Division
  • DateAugust 16, 2019
  • Tel0442152730

Current Economic Situation, August 2019

 

Manufacturing and Facility Investment Edge up,

Services and Consumption Slowing Down

 

 

Mining and manufacturing improved somewhat in June, along with facility investment.  Consumption and services slowed down, as well as construction investment.

 

Industrial production fell 0.7 percent from the previous month in June due to weak services (up 0.3% down 1.0%, m-o-m).  Mining and manufacturing (down 1.3% up 0.2%, m-o-m) improved somewhat.

 

Retail sales (up 0.9% down 1.6%, m-o-m) went down in June, facility investment (down 7.1% up 0.4%, m-o-m) climbed somewhat, and construction investment (down 0.9% down 0.4%, m-o-m) remained weak. 

 

Exports declined 11.0 percent year-on-year in July, staying on a downward trajectory for eight months in a row, as the global semiconductor market remained weak and the US-China trade conflicts continued. 

 

Consumer confidence fell 1.6 points to 95.9 in July, and the business sentiment index (BSI) for the manufacturing sector decreased 2 points to 73, the outlook for August going down 4 points to 71. 

 

The cyclical indicator of the coincident composite index dropped 0.1 points in June to 98.5, and the cyclical indicator of the leading composite index fell 0.2 points to 97.9.

 

The economy added 299,000 jobs year-on-year in July as service jobs continued to grow.  The unemployment rate rose 0.2 percentage points to 3.9 percent.

 

Consumer prices continued to be stable in July, rising 0.6 percent year-on-year, backed by the low prices of fresh food and oil products.

 

In August KOSPI fell, the won weakened, and Korea treasury yields continued to drop. 

 

Housing prices continued to decline in July (down 0.09%, m-o-m), as well as Jeonse (lump-sum deposits with no monthly payments) prices (down 0.19%, m-o-m).  Housing transactions continued to fall.

 

Although the Korean economy grew steadily in the second quarter of 2019, exports and investment had not picked up.  Uncertainties, such as Japan’s trade curbs and deepening trade conflicts between the US and China, have been added to the economy suffering weak global demand, including the semiconductor market.

 

The government will be fully prepared for external risks, including Japan’s trade curbs, successfully implement the frontloaded spending of the supplementary budget, and work to boost the economy through measures to promote investment, exports and consumption.  

 

 

 

 

Key Statistics

 

Employment

 

 

2017

2018

2019

Annual

Q4

Annual

Q1

Q2

Q3

Q4

July

Q1

Q2

Jun

July

Number of employed (million)

26.73

26.88

26.82

26.28

27.02

27.02

26.97

27.08

26.46

27.26

27.41

27.38

Employment rate (%)

60.8

61.0

60.7

59.6

61.2

61.1

60.9

61.3

59.6

61.3

61.6

61.5

(Seasonally adjusted)

60.8

60.9

60.7

60.9

60.7

60.5

60.7

60.5

60.9

60.7

60.9

60.7

 

 

Consumer Price Index

 

 

2018

2019

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

y-o-y

1.1

1.4

2.1

2.0

2.0

1.3

0.8

0.5

0.4

0.6

0.7

0.7

0.6

m-o-m

-0.2

0.9

0.8

-0.2

-0.7

-0.3

-0.1

0.4

-0.2

0.4

0.2

-0.2

-0.3

 

 

Mining and Manufacturing Production

            (q-o-q, m-o-m, %)

Mining and Manufacturing2

2018

2019

Annual

Q2

Jun

Q1

Q2¹

Apr

May¹

Jun¹

Mining

(q-o-q, m-o-m)

-

2.0

0.2

-2.9

1.2

1.9

-1.3

0.2

(y-o-y)

1.3

2.0

1.9

-2.1

-0.8

0.2

0.2

-2.9

Manufacturing

Production

(q-o-q, m-o-m)

-

2.3

0.1

-3.0

1.3

1.9

-1.3

0.2

(y-o-y)

1.2

1.9

1.6

-2.1

-1.0

0.0

0.1

-3.1

Inventory³

8.0

1.9

-0.8

-1.6

3.1

3.3

0.8

-0.9

Shipments

-0.2

-1.1

2.6

-1.9

0.0

-1.0

-0.9

1.4

Average operation ratio

73.5

73.9

73.8

71.8

72.2

72.7

71.9

71.9

Production capacity (y-o-y)

-0.2

-0.2

-0.7

-0.4

-1.2

-1.0

-0.9

-1.6

1. Preliminary

2. Including mining, manufacturing, electricity and gas industry

3. End-period

 

Service Output

(q-o-q, m-o-m, %)

 

2017

2018

2019

Annual

Annual

Q1

Q2

Q3

Q4

Q1

Q2¹

Apr

May¹

Jun¹

Service

activity index

1.9

2.1

0.9

0.4

0.3

0.4

0.3

0.0

0.5

0.3

-1.0

1. Preliminary

 

 

Retail Sales

(q-o-q, m-o-m, %)

 

2017

2018

2019

Annual

Annual

Q1

Q2

Q3

Q4

Q1

Q2¹

Apr

May¹

Jun¹

Retail sales

1.9

4.3

2.1

0.6

-0.2

-0.1

1.3

1.0

-1.2

0.9

-1.6

(y-o-y)

-

-

5.3

5.0

3.8

3.0

1.7

2.0

1.4

3.4

1.2

1. Preliminary

 

 

Facility Investment Index

(q-o-q, m-o-m, %)

 

2017

2018

2019

Annual

Annual

Q1

Q2

Q3

Q4

Q1

Q2¹

Apr

May¹

Jun¹

Facility investment index

14.5

-3.5

6.0

-8.7

-5.4

-1.1

-5.4

1.1

4.4

-7.1

0.4

y-o-y

-

-

10.6

-4.8

-11.8

-6.6

-19.6

-8.8

-6.9

-10.4

-9.3

1. Preliminary

 

 

Construction Completed

(q-o-q, m-o-m, %)

 

2017

2018

2019

Annual

Annual

Q1

Q2

Q3

Q4

Q1

Q2¹

Apr

May¹

Jun¹

Construction completed (constant)

10.5

-5.3

0.8

-4.1

-3.8

-3.7

1.8

-2.6

-2.9

-0.9

-0.4

y-o-y

-

-

0.8

-3.5

-9.7

-7.9

-9.5

-7.3

-11.7

-9.3

-6.3

 1. Preliminary

 

 

Composite Indices of Coincident and Leading Indicators

 

 

2018

2019

Nov

Dec

Jan

Feb

Mar

Apr

May¹

Jun¹

Cyclical indicator of coincident composite index

99.3

99.2

99.1

98.6

98.5

98.4

98.6

98.5

(m-o-m, points)

-0.3

-0.1

-0.1

-0.5

-0.1

-0.1

0.2

-0.1

Cyclical indicator of leading composite index

99.1

98.9

98.6

98.3

98.2

98.3

98.1

97.9

(m-o-m, points)

-0.3

-0.2

-0.3

-0.3

-0.1

0.1

-0.2

-0.2

1. Preliminary

 

 

Exports and Imports

(US$ billion, y-o-y, %)

 

2018

2019

Annual

Q1

Q2

Q3

Q4

Jul

Q1

Q2

Jun

Jul¹

Exports

604.86

145.06

151.62

153.64

154.55

51.81

132.67

138.67

44.09

46.14

(y-o-y)

5.4

9.8

3.1

1.7

7.7

6.1

-8.5

-8.5

-13.7

-11.0

Average daily exports

2.24

2.16

2.30

2.28

2.22

2.16

2.03

2.02

2.05

1.85

Imports

535.20

132.43

133.15

130.31

139.31

44.91

123.47

128.53

40.10

43.70

(y-o-y)

11.9

13.7

13.0

7.8

12.9

16.3

-6.8

-3.5

-10.9

-2.7

Average daily imports

1.98

1.98

2.02

1.93

2.00

1.87

1.88

1.88

1.86

1.75

1. Preliminary

 

Please refer to the attached PDF