The Economic Information and Education Center (EIEC) of KDI published the monthly periodical “Republic of Korea Economic Bulletin, July 2023” in English to provide information on Korea’s current economic trends, policy issues, various economic news and key economic indicators to foreign countries. 

The July publication provides the updated information related to the overall Korea’s economy including Korea’s GDP in Q1 2023, Korea-EBRD cooperation to support Ukraine, and Korean FDI in Q1 2023. Main content is as follows: 

[Economic Bulletin, July 2023]

[Current Economic Trends] 

1. Economic activity

2. Financial markets

3. Public finance

[Economic News Briefing]

1. Korea’s economy grows 0.3% in Q1 2023

2. Korea and EBRD to boost ties for postwar reconstruction and recovery in Ukraine

3. Korean FDI posts US $16.49 billion in Q1 2023

Overview

In April, industrial production, services production and retail sales decreased, while facility investment and construction investment increased. In May, employment continued its upward trend, and CPI inflation slowed down. 

In April, all industry production fell 1.4 percent month-on-month (down 0.8% y-o-y) as industrial production (down 1.2% m-o-m and down 8.9% y-o-y) and services production (down 0.3% m-o-m but up 3.1% y-o-y) decreased from the previous month. 

In April, retail sales decreased from the previous month (down 2.3% m-o-m and down 1.1% y-o-y), while facility investment (up 0.9% m-o-m and up 4.4% y-o-y) and construction investment (up 1.2% m-o-m and up 12.2% y-o-y) increased from the previous month.

Exports fell 15.2 percent year-on-year in May, reflecting an overall slump in semiconductors, wireless communications devices, computers and other IT exports. Average daily exports declined 9.3 percent year-on-year to US $2.43 billion in May 2023. 

The consumer sentiment index (CSI) rose 2.9 points month-on-month in May to 98.0. The business survey index (BSI) for all industries rose 4 points to 76, and the BSI outlook for June increased by 2 points to 76. 

In April, the cyclical indicator of the coincident composite index rose 0.2 points month-on-month, and the cyclical indicator of the leading composite index fell 0.2 points. 

In May, the economy added 351 thousand jobs year-on-year, and the unemployment rate fell 0.3 percentage points to 2.7 percent. 

In May, consumer prices rose at a slower pace by 3.3 percent year-on-year, the CPI excluding the food and energy sectors rose by 3.9 percent, and the index excluding agricultural and petroleum products rose by 4.3 percent. 

In May, stock prices increased and the won strengthened amid expectations for an improvement in the semiconductor industry and the resolution of uncertainty over the US debt ceiling. Korea’s Treasury yields rose amid weakened expectations for an early transition in monetary policy stance. 

In May, housing price falls slowed down (from down 0.47% to down 0.22% m-o-m), and the falls in Jeonse prices (lump-sum deposits with no monthly payments) were also slower than the previous month (from down 0.63% to down 0.31% m-o-m). 

Korea’s inflation has been easing. Economic growth continued to slow down mainly in the manufacturing industry, but downside risks somewhat eased as indicated by a gradual recovery in domestic demand, improved economic sentiment and a steady increase in employment. 

Global uncertainties persisted as downside risks continued to prevail, despite the reopening of China’s economy and expectations of an improvement in the global IT industry. The downside risks include the financial instability of vulnerable sectors and concerns about the prolonged Russia-Ukraine war.

The government plans to make all-out efforts not only for restructuring the economy but also for boosting exports, investment and domestic demand in the second half of the year while stabilizing prices and households’ livelihoods and better managing risks at home and abroad. 

Please click on the Economic Bulletin banner below to see and download the latest full PDF including previous editions.  

Printed publications are available at the Information Desk in KDIS Library (3F) and the Display Table in KDI Central Library (5F). 

If you have any inquiries, please feel free to contact us.

(KDI Economic Bulletin, +82-44-550-4621, hs.hwang@kdi.re.kr)