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S. Korean Manufacturers' Outlook for May Improves

According to Yonhap News,

(SEOUL=Yonhap News) South Korean manufacturers' business expectations for the coming month rebounded on improved prospects in the electronics and metal industries, central bank data showed Friday.

The business survey index (BSI) of manufacturers came to 81 for May, up from 78 in April, according to the Bank of Korea (BOK).

Metal manufacturering sentiment improved sharply, jumping 16 points to 89 for next month, while the index for electronics and communications firms gained six points to 93.

When respondents were asked about their current business conditions, the index rose to 77, snapping a four-month run of losing ground that started in December.

Nevertheless, confidence remains low. A reading below 100 means the number of companies forecasting worse business in the coming month is larger than the number expecting better times.

"The BSI for the car industry lost ground due to a protracted slump in domestic sales and overseas demand," said the BOK. "We have found no signs of recovery in the auto industry yet."

The latest BSI was based on a survey of 2,848 firms conducted from April 12-19, the bank said.

The central bank said this month's BSI poll does not seem to reflect rising hopes for the inter-Korea summit slated for Friday. But some companies are apparently anticipating the reopening of the Kaesong Industrial Park.

The border town industrial area, which houses light industries like textiles, had been a rare example of economic exchange between the two countries for years, but it was shut down in 2016 amid intensifying tensions on the Korean Peninsula.

"The upcoming BSI will be affected by the outcome of Friday's summit and its future developments," it said. "If the two sides decide to reopen the Kaesong complex, it will have a positive impact on light industries."

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Source: Yonhap News (Apr. 27, 2018)

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