[Economic Outlook] Government to Soon Announce Housing Supply Plan for the Capital Region... Industrial Indicators Released

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The government’s plan to supply housing in the Seoul metropolitan area is expected to take shape as early as this week. Attention is also focused on whether industrial activity, which has been sluggish due to the impact of the novel coronavirus disease (COVID-19), and the business and consumer sentiment will recover.

Earlier on the 24th, the government held a meeting of related ministers (Green Room Meeting) chaired by Deputy Prime Minister and Minister of Strategy and Finance Hong Nam-ki to discuss measures to expand housing supply in the metropolitan area. Attendees included Minister of Land, Infrastructure and Transport Kim Hyun-mi, Director of the Office for Government Policy Coordination Koo Yun-cheol, Senior Presidential Secretary for Economic Affairs Lee Ho-seung, Minister of National Defense Jeong Kyeong-doo, Second Deputy Mayor of Seoul Kim Hak-jin, Governor of Gyeonggi Province Lee Jae-myung, and Mayor of Incheon Park Nam-chun.

Given the lineup of meeting participants, there is speculation that concrete measures such as supplying residential land through the relocation of military facilities and creating additional residential sites in Seoul, Gyeonggi, and Incheon are being specifically considered. The government has stated its intention to prepare supply measures, including expanding housing supply in the metropolitan area, as soon as possible.

On the 31st, Statistics Korea will release the industrial activity trends for June. Industrial activity trends serve as an indicator to assess the current real economy. In the May industrial activity trends, the downward trend in the real economy continued following the COVID-19 outbreak.

Consumption rebounded due to emergency disaster relief funds and the transition to everyday quarantine measures, partially cushioning the economic downturn, but manufacturing worsened to levels comparable to those immediately after the 1997 International Monetary Fund (IMF) financial crisis.

The Bank of Korea will announce the results of the July Consumer Sentiment Survey on the 29th. In June, the Consumer Confidence Index (CCSI) recorded 81.8, up 4.2 points from May’s 77.6, continuing an upward trend for two consecutive months. Policy responses such as emergency disaster relief funds and stock market gains led to a recovery in consumer sentiment, but attention is focused on whether this improvement trend can be maintained in July amid growing concerns over a second wave of COVID-19.

On the 30th, the Bank of Korea will release the July Business Survey Index (BSI). The BSI is an indicator that surveys business owners’ judgments and outlooks on their current business conditions; if the number of respondents answering negatively exceeds those answering positively, the index falls below 100.

The June business condition BSI was 56, up 3 points from the previous month. Although it rose for the second consecutive month, the index itself was even lower than March 2009 (58), when the effects of the global financial crisis lingered. Expectations are high to see whether business and management sentiment will improve for three consecutive months through July.

This content was produced with the assistance of AI translation services.