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S. Korea's manufacturing sentiment dips to 3-month low for July

All News 06:00 June 29, 2016

SEOUL, June 29 (Yonhap) -- South Korean manufacturing companies' business sentiment worsened for July from a month earlier with more firms expecting worse conditions for domestic sales, central bank data showed Wednesday.

The business survey index (BSI) of manufacturing firms here came to 72 for the upcoming month, down from 74 for June, according to the Bank of Korea (BOK).

The BSI for July marks the lowest level since 70 registered for April. A reading above 100 means optimists outnumber pessimists while a reading below the benchmark means the opposite.

The on-month drop also came one month after local firms registered the most positive outlook for their business conditions in 12 months.

An index measuring the local firms' sentiment toward exports came to 86 for July, a rebound from a 3-point on-month dip in the previous month.

A separate index for domestic sales, on the other hand, continued to drop from 86 for May to 83 for June, then again to 81 for next month.

Amid an anticipated drop in overall sales, local companies also expected their profitability to worsen, registering a BIS reading of 86 for July, compared with 88 for this month, according to the BOK.

South Korea's exports have shrunk for the longest streak of 17 consecutive months since the start of last year, while its domestic consumption continues to remain in the doldrums with more consumers expecting worsening conditions down the road.

In a separate survey released Tuesday, local consumers' sentiment index came to 99 in June, meaning pessimists outnumber optimists.

The BSI of non-manufacturing firms also slipped to 72 for next month from 73 for June.

Meanwhile, the BOK said the performance BSI of local manufacturers came to 71 in June, unchanged from the previous month, while that of non-manufacturing companies also remained unchanged at 71.

For the whole of 2016, the BSI of manufacturing firms came to 76, with the BSI of non-manufacturing companies coming to 78.

The monthly survey was conducted between June 15-22 on 2,842 local firms, including 1,734 manufacturing companies.

bdk@yna.co.kr
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