South Korean manufacturers’ confidence increased for the second straight month as signs of improving domestic demand buoyed business sentiment.
An index measuring expectations for February increased to 72 from 70 for January, the Bank of Korea said in a statement in Seoul today. A measure of expectations at non-manufacturing companies advanced to 70 from 68. A reading below 100 indicates that pessimists outnumber optimists.
Improving domestic demand sent consumer sentiment to the highest level in eight months in January while the December unemployment rate stayed at a four-year low, adding to signs that Asia’s fourth largest economy is recovering. Gross domestic product grew 0.4 percent in the fourth quarter from the previous period, after two quarters of growth declines.
“Although timid, recovery is taking place,” said Oh Suk Tae, a Seoul-based economist at Standard Chartered Bank Korea. “Progress is slow due to the won’s recent gains, which are slowing corporate investment. The pace of global economic recovery is also an uncertainty,”
The won has risen 20.43 percent against the yen and 7.5 percent against the dollar over the past six months, making it Asia’s best performing currency in that time.
An index measuring consumer confidence rose to 102 for January from 99 in December, the Bank of Korea said yesterday. Today’s index is based on a survey conducted between Jan. 15 and Jan. 22 with responses from 1,484 manufacturers and 1,062 non- manufacturers.
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