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|Economic Bulletin February 2013|
Economic Bulletin February 2013
The Green Book: Current Economic Trends
The Korean economy has seen inflation remain stable and major economic indicators including production, investment and exports somewhat improve, but employment growth has been slowing down and consumption has been sluggish.
In December, the economy added 277,000 jobs year-on-year, but posted a slowdown in employment growth for the third consecutive month.
Consumer price inflation stayed stable in the 1 percent range in January, up from the previous month’s 1.4 percent to 1.5 percent, as falling petroleum product prices offset high agricultural product prices triggered by cold weather and heavy snowfall.
Mining and manufacturing production went up 1.0 percent month-on-month in December thanks to a rise in audio-visual communications equipment and semiconductors, while service output improved by 0.1 percent with rebounding transportation and financial & insurance services.
In December, retail sales fell 1.1 percent from the previous month due to a decrease in semi-durable and non-durable goods sales, despite strong durable goods sales.
Facility investment in December jumped 9.9 percent month-on-month due to brisk machinery and transportation equipment investment. Construction investment went up 5.8 percent helped by an improvement in building construction.
Exports rose 11.8 percent year-on-year in January with exports to China and the ASEAN countries continuing to be strong and also due to an increase in the number of working days. The trade balance remained in the black at US$0.87 billion.
The cyclical indicator of the coincident composite index increased 0.1 point month-on-month in December, and the leading composite index rose 0.4 points.
In January, both the stock prices and the won fell due to companies’ poor business performance in the fourth quarter and increased foreign capital outflows.
Housing prices in January continued to decline, down 0.3 percent, while rental prices increased 0.3 percent month-on-month. External uncertainties linger, as worries over automatic spending cuts in the US continue, and as the European economy is slow to recover. Domestic uncertainties also persist due to weak consumption, unstable investment and increased volatility in exchange rates.
The Korean government will continue to watch the global and domestic economy, strengthen the monitoring of domestic and foreign markets, and reinforce policy responses to stimulate the economy.
At the same time, the government will focus on securing the lives of the low- and middle-income classes through job creation and by stabilizing the prices of necessities, while continuing to adopt policies to improve the health of the economy
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