Corporate Sentiment Hits Highest Level in 10 Years... Manufacturing Giants and Exporters 'Optimistic'

[Asia Economy Reporter Eunbyeol Kim] The business sentiment perceived by companies has surged to the highest level in about 10 years. While the Business Survey Index (BSI) for all sectors mostly rose, the BSI for large manufacturing companies and export companies exceeded 100. When the BSI surpasses 100, it means that more companies viewed the current business situation positively.

According to the 'April 2021 Business Survey Index (BSI) and Economic Sentiment Index (ESI)' released by the Bank of Korea on the 29th, the BSI for all industries this month was 88, up 5 points from the previous month, marking the highest level since June 2011 (88). This is the highest in 9 years and 10 months.

The manufacturing BSI also jumped 7 points to 96, the highest since May 2011 (96), and the non-manufacturing BSI rose 5 points to 82, the highest level since May 2018 (84).

Among manufacturing sectors, the BSI for large enterprises (107) and export companies (109) both exceeded 100. The BSI is a statistic that surveys entrepreneurs' judgments and outlooks on the current business situation. It ranges from 0 to 200, and when it exceeds 100, it can be interpreted that more companies responded positively than negatively.

With increased sales of sports goods and rising demand for toys due to Children's Day, the BSI for other manufacturing industries jumped by 17 points. The BSI for chemical products rose by 13 points due to improved cosmetics sales, rising chemical product prices, and increased prices of semiconductors and electronic components, while the electronic, video, and communication equipment sector rose by 7 points, resulting in a favorable manufacturing business BSI.

The non-manufacturing business BSI fell in sectors such as information and communication (-5 points), but construction rose by 10 points, real estate by 9 points, and wholesale and retail by 8 points, leading to a 5-point increase from the previous month to 82. As consumer sentiment improved and domestic demand recovered, the wholesale and retail BSI rose, influenced by improved sales performance and expanded private orders for residential and commercial properties.

The Economic Sentiment Index (ESI), which reflects the Consumer Sentiment Index (CSI) along with the BSI, rose 4 points from the previous month to 105.3. When the ESI exceeds 100, it indicates that the economic sentiment of all private economic agents has improved compared to the past average.