The Economic Information and Education Center (EIEC) of KDI published the monthly periodical “Republic of Korea Economic Bulletin, October 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 October publication provides the updated information related to the overall Korea’s economy including 2024 budget proposal, Korea’s GDP in Q2 2023, external debt in Q2 2023, and Korean FDI in Q2 2023. Main content is as follows: 

[Economic Bulletin, October 2023]

[Current Economic Trends] 

1. Economic activity

2. Financial markets

3. Public finance

[Policy Issue]

2024 budget proposal

[Economic News Briefing]

1. Korea’s economy grows 0.6% in Q2 2023

2. External debt amounts to US $665.1 billion in Q2 2023

3. Korean FDI posts US $15.31 billion in Q2 2023

Overview

In July, services production and construction investment increased while industrial production, retail sales and facility investment decreased. In August, job growth was even stronger while consumer prices rose at a faster pace.

In July, all industry production dropped 0.7 percent month-on-month (down 1.4% y-o-y) as industrial production fell (down 2.0% m-o-m and down 8.0% y-o-y) while services production climbed (up 0.4% m-o-m and up 1.9% y-o-y) from the previous month.

In July, construction investment rose (up 0.8% m-o-m and up 10.8% y-o-y), while retail sales (down 3.2% m-o-m and down 1.7% y-o-y) and facility investment (down 8.9% m-o-m and down 11.0% y-o-y) fell from a month earlier.

Exports fell 8.4 percent year-on-year in August. Average daily exports also declined by 8.4 percent from a year ago to US $2.16 billion.

The consumer sentiment index (CSI) in August fell marginally by 0.1 points month-on-month to 103.1. The business survey index (BSI) for all industries fell 3 points from a month ago to 71 and the BSI outlook for September rose 2 points to 73.

In July, the cyclical indicator of the coincident composite index decreased by 0.5 points month-on-month, and the cyclical indicator of the leading composite index rose by 0.4 points.

In July, the economy added 268,000 jobs year-on-year and the unemployment rate fell 0.1 percentage points to 2.0 percent.

In August, consumer prices rose at a faster pace by 3.4 percent year-on-year, the CPI excluding the food and energy sectors rose by 3.3 percent, and the index excluding the agricultural and petroleum products rose by 3.9 percent. The index of the cost of basic necessities rose by 3.9 percent.

In August, stock prices fell, the won weakened and Korean Treasury bond yields rose amid concerns about the Fed’s prolonged monetary tightening and escalating risks related to the Chinese economy.

In August, housing prices rose at a faster rate (from up 0.03% to up 0.16% m-o-m), and Jeonse (lump-sum deposits with no monthly payments) price growth turned positive (from down 0.04% to up 0.15% m-o-m).

Despite monthly fluctuations stemming from rising global oil prices and seasonal factors, the Korean economy has seen a continued slowdown in inflation, and the economic downturn has partially eased thanks to improving exports, consumer sentiment and employment.

Internationally, alongside the anticipations for the global IT industry’s rebound and a surge in Chinese tourists, concerns remain over recession in major economies. Meanwhile, uncertainties linger, driven by monetary tightening, impacts of the Russia-Ukraine war, and volatility in raw material prices.

The government will closely monitor risks at home and abroad and improve the country’s economic structure, focusing on the stabilization of households’ livelihoods, including achieving price stability during the Chuseok (Korean harvest festival) holidays. The government will also go all out to ramp up exports, investment and domestic consumption.

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)