South Korean manufacturers’ confidence fell from a 9-month high as concern mounted that a deepening debt crisis in Europe may crimp demand for the nation’s exports and slow growth.
A political impasse in Greece this month sparked worries the Mediterranean nation may leave the euro, leading to broader contagion. South Korean Finance Minister Bahk Jae Wan said last week he can’t be optimistic about an economic recovery in South Korea amid the possibility of a global recession.
The Bank of Korea held rates for an 11th straight month on May 10, while ratcheting up language to address the deteriorating European outlook. Downside risks to the country’s economic growth because of Europe are “significant,” the central bank said.
The business survey, conducted from May 15 to May 22, was based on responses from 1,597 manufacturers and 872 non- manufacturers.
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