Services, Retail Sales, Facility investment and Construction investment Up, Industrial production Down

Current Economic Situation, April 2023

Services, Retail Sales, Facility investment and Construction investment Up, Industrial production Down

Services production, retail sales, facility investment and construction investment increased while industrial production decreased in February 2023.

In February, the entire production increased (up 0.3%, m-o-m and up 2.9%, y-o-y) as services production (up 0.7%, m-o-m and up 7.2%, y-o-y) rose while industrial production (down 3.2%, m-o-m and down 8.1%, y-o-y) fell.

In February 2023, retail sales (up 5.3%, m-o-m and down 0.8%, y-o-y) and facility investment (up 0.2%, m-o-m and up 5.7%, y-o-y) and construction investment (up 6.0%, m-o-m and up 22.4%, y-o-y) all went up.

Exports declined by 13.6 percent year-on-year in March 2023 led by a slump in the export of IT products such as semiconductors and displays. Average daily exports decreased by 17.2 percent from a year ago to US $2.30 billion in March 2023.

The consumer sentiment index (CSI) grew by 1.8 points in March 2023 to 92.0 from the previous month. The business survey index (BSI) in March for the entire sector also rose by 3 points to 72 and the BSI outlook for April 2023 grew by 2 points to 73.

In February 2023, the cyclical indicator of the coincident composite index grew by 0.4 points while the cyclical indicator of the leading composite index fell by 0.3 points.

Employment rose at a faster pace but consumer prices grew at a slower pace in March 2023.

The economy added 469,000 jobs year-on-year in March 2023 and the unemployment rate fell by 0.1 percentage points from a year ago to 2.9 percent.

The consumer prices rose at a slower pace by 4.2 percent year-on-year in March 2023 and the consumer price index excluding the food and energy sectors rose by 4.0 percent and the index excluding the agricultural and petroleum products grew by 4.8 percent.

In March 2023, stock prices increased, Korean treasury yields fell, and the won strengthened due to reduction of financial instability caused by the collapse of some small and mid-sized U.S. banks and expectations for shifting monetary tightening policies.

In February 2023, declines in housing prices (-1.49% → -1.15%, m-o-m) and prices of Jeonse (lump-sum deposits with no monthly payments) (-2.29% → -1.80%, m-o-m) were somewhat slower than the previous month.

Amid a slower inflation increase in Korea, domestic demand recovery was seen mainly due to an increase of in-person activities, but economic slowdowns continued mostly in the manufacturing industry as indicated by downturns of exports and facility investment and other related situations.

Internationally, global economic uncertainties continued to linger driven by downside risks including financial instability in the vulnerable sectors due to monetary tightening and concerns about the prolonged Russia-Ukraine war alongside favorable economic factors such as the expectations of China’s reopening.

The government will go all out to improve economic structure and boost economic vitality, focusing on the promotion of export, investment and domestic demand, on the back of the efforts to stabilize prices and people’s livelihoods and thoroughly manage risks at home and abroad. 

Key Statistics

Employment

Consumer Price Index

                                                                                         (%)

Retail Sales

(Percentage change from the previous period, %)

1. Preliminary

Facility Investment Index

(Percentage change from the previous period, %)

1. Preliminary

Construction Completed

 (Percentage change from the previous period, %)

1. Preliminary

Exports and Imports

 (US$ billion)

Mining, Manufacturing, Electricity and Gas Production

                (Percentage change from the previous period, %)

1. Preliminary

2. Mining, Manufacturing, Electricity and Gas Production

3. End-point (month, quarter, and year)

4. Average operation ratio for the month (or quarter)

Service Output

           (Percentage change from the previous period, %)

      1. Preliminary

Composite Indices of Coincident and Leading Indicators

                                                                                           (Points)

1. Preliminary