[Economic Outlook] Discussions on Easing Comprehensive Real Estate Tax and Capital Gains Tax... Focus on Household Finances in Q1

Bank of Korea to Announce 'April Producer Price Index' on the 21st

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] As the ruling party and government continue discussions on revising real estate policies, attention is focused on whether comprehensive real estate tax and capital gains tax will be amended. Additionally, statistics that can provide insight into household financial conditions in the first quarter will be released.

The Statistics Korea will release the results of the first quarter Household Income and Expenditure Survey on the 20th. Since the first quarter marked a period when the third wave of COVID-19 subsided and the economy rebounded, it is expected that the living conditions of the public have improved to some extent. There is also interest in how distribution indicators behave amid the economic recovery.

On the same day, the government will hold a meeting of ministers related to the real estate market, chaired by Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki. They are expected to discuss measures to ease loan regulations, including revisions to the comprehensive real estate tax and capital gains tax.

The Bank of Korea will announce the 'Producer Price Index for April' on the 21st. According to the 'Producer Price Index for March 2021' released by the Bank of Korea on the 21st of last month, the producer price index in March rose 0.9% month-on-month, marking the fifth consecutive month of increase. It also rose 3.9% year-on-year, continuing an upward trend for four months.

The rise was mainly seen in manufactured goods. Coal and petroleum products (9.7%) increased for the fifth consecutive month, and chemical products (2.8%) rose for the tenth consecutive month, resulting in a 1.6% increase in manufactured goods compared to the previous month. This was due to rising international oil and raw material prices and increased demand from upstream industries.

As the strong trend in oil and raw material prices continues in April, there are concerns that the level of producer prices has also risen further.