SEOUL: South Korean manufacturers’ business sentiment climbed to an 11-month high for May, a poll showed Friday, apparently reflecting what top officials here have called recent signs of improvement. The business survey index (BSI) of manufacturing companies came to 73 for the upcoming month, up from 70 for April, according to the survey by the Bank of Korea (BOK).
The May reading marked the highest level since 76 registered for June 2015. A reading below 100 means pessimists outnumber optimists while a reading above the benchmark means the opposite. The improvement in manufacturing sentiment came as local companies of all sizes and types forecast better conditions for their business in May.
An index measuring the business sentiment of large firms came to 78 for May, up 3 points from a month earlier, while a separate index for smaller firms gained 5 points to 67 over the cited period. Such an improvement in business sentiment follows what many government officials, including the finance minister and Bank of Korea governor, have called “possible signs of improvement.”
South Korea’s exports, for instance, have dipped every single month since the start of last year. However, the rate of drop has significantly slowed over the past few months from an 18.5 percent on-year plunge in January to a 12.2 percent decline the following month and again to a 8.2 cut in March. More exporters expected their business conditions to further improve next month with the index for export companies coming in at 71 for May, up from 70 for this year, the BOK data showed.
The index for more locally-focused companies came to 75, up from 70 for April. Meanwhile, the central bank said the index on the actual business performance of manufacturers came to 71 in April, up from 68 the previous month and the highest since October 2015.
