Sales at South Korea’s major department stores rose for a 14th month in April, adding to signs the nation’s economy is strengthening.
Spending at the three biggest chains climbed 8.8 percent from a year earlier, after rising 4.6 percent in March, the Ministry of Knowledge Economy said in a statement today.
The economy will expand 5.9 percent this year, driven by exports and domestic demand, the state-run Korea Development Institute said in a weekend report that called on policy makers to raise interest rates. President Lee Myung Bak said in a radio speech yesterday that domestic private demand has almost recovered to pre-crisis levels and “the green light is finally on” for the real economy.
The central bank last week left borrowing costs unchanged at a record-low 2 percent for a 15th month amid risks from Europe’s debt crisis. Bank of Korea Governor Kim Choong Soo, speaking May 12 after government figures showed the jobless rate fell for a third straight month to 3.7 percent, said that growth may exceed the economy’s potential.
Kim is under pressure to join counterparts from India to China in tightening monetary policy to curb inflation and avert asset bubbles.
South Korea’s exports surged 31.5 percent in April from a year earlier, the sixth monthly gain, and household income rose 7.3 percent in the first quarter, the biggest increase in seven years.
Discount-store sales rose 0.3 percent last month, after rising 1.6 percent in March, according to today’s report.