Economic
Bulletin June 2014 from
South Korea.
The Green
Book: Current Economic Trends from Ministry of strategy and finance.
http://english.mosf.go.kr/publ/view.do?bcd=P0002&seq=1218&bPage=1
Overview
The Korean economy suffered from a fall in retail sales and
service output in April. However, employment and inflation remained stable, and
manufacturing production, facility investment and construction improved.
The economy added less jobs in April, adding 581,000 jobs
year-on-year compared to 649,000 jobs in March. Inflation in May remained
stable in the 1 percent range, increasing 1.7 percent year-on-year, up from 1.5
percent in the previous month.
Mining and manufacturing production continued to increase for
the second consecutive month in April (up 0.1%), despite the sales ban on
mobile carriers, helped by strong mobile phone exports and automobile
production.
Service
output, which increased 0.5 percent in March, fell 0.1 percent in April as the
Sewol ferry disaster had a negative effect on wholesale & retail,
entertainment, cultural & sports services, and hotels & restaurants.
Retail sales, which increased 1.8 percent in the previous month, fell 1.7
percent due to weak durable and semi-durable goods sales in the wake of the
Sewol ferry disaster.
Facility
investment, which increased 1.2 percent in March, continued to improve in
April, rising 2.6 percent, as investment in both transportation equipment and
machinery increased. Construction completed also increased 6.9 percent
month-onmonth after declining 3.8 percent in March.
The
composite index of coincident indicators fell 0.3 points month-on-month in
April due to a fall in retail sales and service output, but the composite index
of leading indicators rose 0.1 points. Exports in May fell 0.9 percent
year-on-year due in part to 1.5 fewer days worked, but average daily exports
increased and a trade surplus continued at US$5.35 billion. The stock market
had plummeted in the beginning of May, but rebounded and remained stable as
foreign investors bought more Korean shares than they sold. The value of the
won rose.
In
May, housing prices across the country rose at a slower pace from 0.1 percent
to 0.0 percent month-on- month, and the fall in prices in the Seoul
metropolitan area accelerated from 0.02 percent to 0.1 percent. Jeonse
(lump-sum deposits with no monthly payments) prices continued to increase at
the same pace as the previous month, rising 0.1 percent owing to the ending of
the spring moving
season.
The
economy continues to recover, but the recovery in the private sector has yet to
fully take hold, and consumption and service industry indicators appear to be
slowing down in the wake of the April Sewol ferry disaster.
The
Korean government will continue to closely monitor internal and external
economic trends as external risks remain, including US quantitativeeasing
tapering, uncertainties in emerging economies, and the weakening of the yen,
and at the same time will work to help the economic recovery take hold and
protect domestic markets from external shocks.
