KDI "Manufacturing Sector Stable, Economic Sentiment Improving... Economic Downturn Easing"

[Sejong=Asia Economy Reporter Son Seonhee] The Korea Development Institute (KDI) analyzed that the economic downturn is easing as economic sentiment improves in the Korean economy.

In the 'April Economic Trend Report' released on the 7th, KDI summarized, "Manufacturing continues to show a favorable trend, and with the consumer sentiment index and the business survey index rising sharply, expectations for economic improvement are increasing." However, it added, "Last month, the daily new domestic COVID-19 cases remained around 400, and with the spread of variant coronaviruses overseas, economic uncertainty due to COVID-19 remains high."

KDI releases the economic trend report monthly, and compared to last month's assessment that "the economic downturn is continuing," the analysis of the economic situation has changed significantly within a month.

The optimistic analysis is mainly attributed to the rapid improvement in manufacturing. KDI stated, "In February, despite a decrease in the number of working days, total industrial production increased by 0.4% due to a significant expansion in demand related to manufacturing," and added, "The average operating rate of manufacturing rose to a relatively high level, and exports in March also increased sharply following the previous month, sustaining the improvement trend in manufacturing."

The service sector remains contracted. However, KDI analyzed, "Since mid-February, social distancing levels have been lowered, partially alleviating the downturn." Notably, last month the consumer sentiment index rose by 3.1 points from the previous month (97.4) to 100.5, surpassing the baseline (100) for the first time since January last year, highlighting that "this suggests the possibility of consumption recovery."

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