'Primary Metals' Down 17 Points Due to Raw Material Price Increase
Economic Sentiment Index Rises by 1 Point
On the 28th, ahead of the start of 'With Corona' in November, office workers and citizens having lunch are moving around Myeongdong, Jung-gu, Seoul. Photo by Jinhyung Kang aymsdream@
[Asia Economy Reporter Jang Sehee] Corporate sentiment has returned to an upward trend. This is due to the slowdown in the spread of COVID-19, the expansion of vaccination, and the easing of social distancing measures.
According to the "October 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 recorded 86, up 2 points from the previous month. The BSI is an indicator showing the business conditions perceived by companies; if the number of firms responding negatively exceeds those responding positively, the index falls below 100. By sector, manufacturing maintained the previous month's level, but non-manufacturing sectors mainly saw an increase.
Kim Daejin, head of the Corporate Statistics Team at the Bank of Korea's Economic Statistics Bureau, analyzed, "The BSI for all industries rose 2 points from the previous month due to the slowdown in COVID-19 spread and the easing of social distancing." He added, "The rise in non-manufacturing reflects expectations for growth recovery, with wholesale and retail sectors increasing."
The manufacturing business condition BSI recorded 90, the same as the previous month. It rose mainly in other machinery and equipment (+5 points) and electrical equipment (+6 points), while metal processing (-8 points) and chemical substances and products (-7 points) declined. By company size and type, large enterprises recorded 100, down 1 point from the previous month, while small and medium enterprises remained at 78. Export companies increased by 1 point, whereas domestic companies fell by 2 points.
The non-manufacturing business condition BSI also rose 5 points from the previous month to 84. Although it had declined the previous month, it turned upward. It increased mainly in real estate (+13 points) and wholesale and retail (+8 points).
The November business outlook BSI recorded 88 for manufacturing, down 5 points from the previous month, and 85 for non-manufacturing, up 4 points from the previous month. In manufacturing, the rise in raw material prices led to declines centered on primary metals (-17 points) and electronic, video, and communication equipment (-9 points). In non-manufacturing, information and communication (+10 points) rose due to expectations of increased advertising orders.
Meanwhile, the October Economic Sentiment Index (ESI) rose 1.0 point from the previous month to 105.6. The ESI is centered around a long-term average of 100; exceeding 100 means that the economic sentiment of all private economic agents, including companies and households, has improved compared to the past average. The cyclical component rose 0.7 points from the previous month to 108.3.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
