- Current Economic Trends
Mining and manufacturing production improved from the previous month in November, as well as services output. Facilities investment and completed construction works rose, but retail sales slowed.
Industrial production rose 0.7 percent month-on-month in November. Mining and manufacturing increased (up 0.3%, m-o-m and up 0.5%, y-o-y), and so did services output (up 0.7%, m o-m and down 1.4%, y-o-y). Compared to a year ago, industrial production fell 0.6 percent.
Retail sales declined (down 0.9%, m-o-m and down 1.5%, y-o-y), but facilities investment rose (up 3.6%, m-o-m and up 5.7%, y-o-y) and completed construction works (up 2.1%, m-o-m and down 0.8%, y-o-y) rose.
Exports increased 12.6 percent year-on-year in December, backed by the rising IT sector and more days worked (1 day). Average daily exports, an indicator calculated according to the days worked, went up 7.9 percent from a year ago (US $1.99 billion in Dec 2019 >> US $2.14 billion in Dec 2020).
The consumer sentiment index (CSI) fell 8.1 points month-on-month in December to 89.8. The business sentiment index (BSI) for the manufacturing sector went down 3 points to 82, and the BSI outlook for January 2021 dropped 4 points to 77.
The cyclical indicator of the coincident composite index for November increased 0.5 points from a month ago to 98.8, and the cyclical indicator of the leading composite index rose 0.7 points to 102.5.
The economy lost 628,000 jobs year-on-year in December, and the unemployment rate rose 0.7 percentage points from a year ago to 4.1 percent.
Consumer prices rose 0.5 percent from a year ago in December, and core inflation rose 0.9 percent.
KOSPI jumped in December due to COVID-19 vaccinations starting in major countries and additional stimulus measures in the US. The won strengthened, and Korea treasury yields, especially long-term bond yields, went up in line with rising global market interest rates.
Home prices continued to increase in December (up 0.54% >> up 0.90%, m-o-m), as well as Jeonse (lump-sum deposits with no monthly payments) prices (up 0.66% >> up 0.97%, m-o-m).
Although the economy has seen exports improving, uncertainties linger regarding the real economy as domestic consumption and employment have been affected by a third wave of COVID-19 and stricter social distancing measures that follow.
Real economic indicators have been slowing down amid a resurgent virus in major economies with stronger lockdowns. However, there are expectations of economic recovery as vaccinations are on the way and stronger policy measures are to be implemented in major economies.
The government will expedite tailored policies towards supporting economies damaged by the virus and will strengthen policies to stabilize the livelihoods of the public and employment.
* For further details, please refer to the attached file