Economic Bulletin (Vol. 40 No. 11)_english by KOCIS

Republic of Korea

Economic Bulletin

Vol.40 No.11 November 2018 eb.kdi.re.kr ISSN 2287-7266

The Green Book: Current Economic Trends Economic News Briefing Korea Ranks 5th in WB Doing Business 2019 Index Koreaâ&#x20AC;&#x2122;s Exports Expected to Exceed US $600 Billion this Year Government to Launch a Tech Fund Worth 340 Billion Won Korea Grows 0.6% in Q3 2018

Statistical Appendices

Najeonchilgi Najeonchilgi refers to Koreaâ&#x20AC;&#x2122;s traditional laquerware inlaid with mother-of-pearl. To make Najeonchilgi, sheets of mother-of-pearl are placed onto a wooden surface that has been polished and varnished several times with lacquer, and then more layers of lacquer are applied. Najeonchilgi is found in various items from jewelry boxes to large wardrobes.

The Green Book: Current Economic Trends Overview

01. External economic situation

02. Private consumption

03. Facility investment

04. Construction investment

05. Exports and imports

06. Mining and manufacturing production

07. Service sector activity

08. Employment

09. Financial markets

9.1 Stock market

9.2 Exchange rate

9.3 Bond market

9.4 Money supply and money market

10. Balance of payments

11. Prices

11.1 Consumer prices

11.2 International oil and commodity prices

12. Real estate market

12.1 Housing market

12.2 Land market

13. Composite indices of business cycle indicators

Contents

Economic News Briefing Korea ranks 5th in WB Doing Business 2019 Index Koreaâ&#x20AC;&#x2122;s exports expected to exceed US $600 billion this year Government to launch a tech fund worth 340 billion won Koreaâ&#x20AC;&#x2122;s external debt rises to US $449.5 billion, soundness indicators stable Korea grows 0.6% in Q3 2018 (advanced)

Editor-in-Chief Suh Joong-Hae (KDI) Yoon Tae-Sik (MOEF) Editorial Board Suk Ran (MOEF) Lee Jae-Yeal (KDI) Yu Seong-Im (KDI) Coordinators Kim Dae-Hyun (MOEF) Lee Ji-Youn (KDI)

45 Statistical Appendices

Editors Kwon Bum-Joon (MOEF) Shin Dong-Gyun (MOEF)

The Green Book:

Current Economic Trends

Overview 01. External economic situation 02. Private consumption 03. Facility investment 04. Construction investment 05. Exports and imports 06. Mining and manufacturing production 07. Service sector activity 08. Employment 09. Financial markets 10. Balance of payments 11. Prices 12. Real estate market 13. C omposite indices of business cycle indicators

November 2018

Overview

Industrial activities slowed down in September due to fewer days worked as the Chuseok holiday fell in the month. Exports and consumption have been stable, but investment and employment remain weak, and there are growing uncertainties amid ongoing trade conflicts between the US and China. The economy added 45,000 jobs year-on-year in September led by construction jobs. Employment fell in manufacturing and services. Young adult unemployment declined (9.2% → 8.8%, down 0.4%p, y-o-y). Consumer price inflation accelerated in October (up 1.9% → up 2.0%, y-o-y, compared with a month ago) due to a price hike in petroleum products amid rising international oil prices, as well as a low base effect from a year ago when agricultural product prices were low. All industry production fell in September (up 0.5% → down 1.3%, m-o-m): Mining and manufacturing production declined (up 1.3% → down 2.5%, m-o-m) due to weak automobiles and electronic components. Service output stayed unchanged, despite a fall in wholesale & retail, backed by strong financial & insurance services and real estate & renting. Retail sales fell in September (up 0.1% → down 2.2%, m-o-m) as the sales of durable goods (down 7.6%) and nondurable goods (down 1.1%) declined. Semidurable goods sales (up 1.8%) increased. Facility investment improved in September (down 1.6% → up 2.9%, m-o-m) as machinery investment increased. Construction completed continued to fall (down 0.6% → down 3.8%, m-o-m) as both building construction and civil engineering works declined. In September the cyclical indicator of the coincident composite index fell 0.3 points to 98.6, and the cyclical indicator of the leading composite index fell 0.2 points to 99.2. Exports rose 22.7 percent year-on-year in October to US $54.97 billion, the second largest on record, due to strong petroleum products, machinery and petrochemicals. Average daily exports posted US $2.39 billion, the third largest on record. In October KOSPI fell amid ongoing trade conflicts between the US and China, as well as worries over Italy’s debt-boosting budget plan. The dollar-won exchange rate rose as the global stock market lost momentum and a yuan weakened. Government bond yields fell. Housing prices rose in October (up 0.31% → up 0.19, m-o-m) as price hikes continued in the Seoul metropolitan area. Jeonse (lump-sum deposits with no monthly payments) prices across the country fell (down 0.08% → down 0.05%, m-o-m), but rose in the Seoul metropolitan area.

Economic Bulletin

The Green Book

Exports are expected to grow in line with recovering global economies, but job markets are weak and there are external risks, such as US-China trade conflicts, Fed’s rate hikes and increasing volatility in global financial markets. The government will strengthen its risk management and boost the economy through fiscal spending. Fiscal expenditure will be focused on increasing support for low-income households and small merchants, and on assisting job creation through policies to promote new technologies and industries.

1. External economic situation The global economy has stayed on a recovery path. However, risks linger, which may arise from global trade conflicts, monetary policy normalization in major economies and financial market volatility in emerging economies.

US The US economy grew 3.5 percent (annualized q-o-q, advanced estimates) in the third quarter of 2018. Consumption stayed strong but investment grew at a slower rate compared with the previous quarter. Industrial production rose 0.3 percent month-on-month in September as manufacturing production (up 0.2%, m-o-m) and mining output (up 0.5%, m-o-m) increased. The ISM Manufacturing Index dropped in October. ISM Manufacturing Index (base=50)

58.7 (May 2018) → 60.2 (Jun) → 58.1 (Jul) → 61.3 (Aug) → 59.8 (Sep) → 57.7 (Oct)

Retail sales rose 0.1 percent month-on-month in September: Automobile sales picked up (up 0.8%, m-o-m) but sales at food services and drinking places declined (down 1.9%, m-o-m). Consumer confidence continued to rise in October. Conference Board Consumer Confidence Index (1985=100)

128.8 (May 2018) → 127.1 (Jun) → 127.9 (Jul) → 134.7 (Aug) → 135.3 (Sep) → 137.9 (Oct)

Existing home sales dropped 3.4 percent month-on-month in September to an annual rate of 5,150,000 homes (down 4.1%, y-o-y). New home sales fell 5.5 percent month-on-month to an annual rate of 550,000 units (down 13.2%, y-o-y). Case-Shiller Home Price Index (y-o-y, %)

6.8 (Mar 2018) → 6.7 (Apr) → 6.5 (May) → 6.4 (Jun) → 5.9 (Jul) → 5.5 (Aug)

New home sales (m-o-m, %)

1.4 (Mar 2018) → -5.8 (Apr) → 3.2 (May) → -5.4 (Jun) → -1.5 (Jul) → -3.0 (Aug) → -5.5 (Sep)

November 2018

Nonfarm payrolls rose by 250,000 in October, and the employment rate rose 0.2 percentage points from the previous month to 60.6 percent. The unemployment rate stayed at 3.7 percent, the lowest level since December 1969. Labor force participation rate (%)

62.7 (May 2018) → 62.9 (Jun) → 62.9 (Jul) → 62.7 (Aug) → 62.7 (Sep) → 62.9 (Oct)

Nonfarm payroll increase (m-o-m, thousands)

268 (May 2018) → 208 (Jun) → 165 (Jul) → 286 (Aug) → 118 (Sep) → 250 (Oct)

Unemployment rate (%)

3.8 (May 2018) → 4.0 (Jun) → 3.9 (Jul) → 3.9 (Aug) → 3.7 (Sep) → 3.7 (Oct)

US nonfarm payroll growth and unemployment rate (thousands)

(%)

600

400

200 8

-200 -400

-600 2

-800

US nonfarm payroll growth (m-o-m, left)

-1,000

0 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Unemployment rate (right)

Source: US Department of Commerce, Federal Reserve Board

(Percentage change from previous period)

2016

2017

Annual Annual Q1

Real GDP

2018

Q3 Aug Sep Oct

1.6

2.2

1.8

3.0

2.8

2.3

2.2

4.2

3.5

- Personal consumption expenditures 2.7

2.5

1.8

2.9

2.2

3.9

0.5

3.8

4.0

- Nonresidential fixed investment

0.5

5.3

9.6

7.3

3.4

4.8 11.5

8.5

0.8

- Residential fixed investment

6.5

3.3 11.1 -5.5 -0.5 11.1 -3.4 -1.6 -4.0

Industrial production

-1.9

1.6

0.2

1.2 -0.4

1.9

0.6

1.3

0.8

0.4

0.3

Retail sales

2.9

4.7

1.5

0.6

2.3

0.4

1.8

1.3

0.1

Existing home sales

4.1

1.7

1.0 -1.0 -2.6

3.5 -1.5 -1.7 -2.6 -0.2 -3.4

Unemployment rate2

4.9

4.4

4.7

4.3

4.1

3.9

3.8

3.9

3.7

Consumer prices (y-o-y)

1.3

2.1

2.6

1.9

2.0

2.1

2.3

2.6

2.7

2.3

1. Annualized rate (%) 2. Seasonally adjusted Sources: US Department of Commerce, Bloomberg

1.0

Economic Bulletin

The Green Book

China China’s economy grew 6.5 percent year-on-year in the third quarter of 2018, reaching the government’s growth target. Exports continued to be strong, but investment growth has been slowing down.

China’s GDP growth and fixed asset investment (%)

(%)

GDP (y-o-y, left) Fixed asset investment (accumulated, y-o-y, right)

4 2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Source: China National Bureau of Statistics

(Percentage change from same period in previous year)

2016

2017

Annual Annual Q1

2018

Jul Aug Sep

Real GDP

6.7

6.9

6.8

6.7

6.5

Industrial production

6.0

6.6

6.8

6.9

6.3

6.2

6.1

6.6

6.0

6.1

5.8

Fixed asset investment (accumulated, nominal)

8.1

7.2

9.2

8.6

7.5

7.2

7.5

6.0

5.4

5.5

5.3

5.4

Retail sales (nominal)

10.4

10.2 10.2 10.8 10.3

9.9

9.7

9.0

8.8

9.0

9.2

Exports

-6.6

6.5

3.2

6.6

6.1

9.4 13.7 11.5 11.4 11.4

9.1 14.5

Consumer prices

2.0

1.6

1.4

1.6

1.8

2.2

1.8

2.3

2.1

2.3

2.5

Producer prices1

-1.3

6.3

7.4

5.8

6.2

5.9

3.7

4.1

4.6

4.1

3.6

1. Quarterly data show an average of monthly data Source: China National Bureau of Statistics

November 2018

Japan Japan’s economy saw its industrial production (down 1.1%, m-o-m), retail sales (down 0.2%, m-o-m) and exports (down 1.3%, m-o-m) slowing down in September. Unemployment rate (%)

2.8 (Sep 2017) → 2.8 (Oct) → 2.7 (Nov) → 2.7 (Dec) → 2.4 (Jan 2018) → 2.5 (Feb) → 2.5 (Mar) → 2.5 (Apr) → 2.2 (May) → 2.4 (Jun) → 2.5 (Jul) → 2.4 (Aug) → 2.3 (Sep)

Japan’s GDP growth and industrial production (%)

GDP (q-o-q, left) Industrial production (q-o-q, right)

(%)

-1

-5

-2

-10

-3

-15

-4

-20 -25

-5 2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Sources: Japan's Cabinet Office, Ministry of Economy Trade and Industry, Ministry of Finance, Statistics Bureau of Japan

(Percentage change from previous period)

2016

2017

Annual Annual Q1

2018

Jul

Aug Sep

Real GDP

1.0

1.7

0.7

0.5

0.6

0.2 -0.2

0.7

Industrial production

-0.2

4.5

0.2

1.8

0.4

1.6 -1.3

1.3 -1.7 -0.2

0.2 -1.1

Retail sales (nominal)

-0.6

1.9 -0.2

0.6

0.1

1.3 -0.6

0.4

1.0

0.1

0.9 -0.2

Exports (y-o-y)

-7.4

11.8

Consumer prices (y-o-y)

-0.1

0.5

8.5 10.5 15.1 13.0

4.9

7.5

2.9

3.9

6.6 -1.3

0.3

1.3

0.7

1.1

0.9

1.3

0.4

0.6

1.2

Sources: Japan's Cabinet Office, Ministry of Economy, Trade and Industry, Ministry of Finance, Statistics Bureau of Japan

Economic Bulletin

The Green Book

Eurozone The eurozone economy grew 0.2 percent quarter-on-quarter in the third quarter of 2018, a slowdown from 0.4 percent growth in the previous quarter due to weak German automobiles. However, job markets stayed stable after unemployment hit the lowest since December 2008 in August. Unemployment rate (%)

8.6 (Jan 2018) → 8.6 (Feb) → 8.5 (Mar) → 8.4 (Apr) → 8.2 (May) → 8.2 (Jun) → 8.2 (Jul) → 8.1 (Aug) → 8.1 (Sep)

Manufacturing PMI

59.6 (Jan 2018) → 58.6 (Feb) → 56.6 (Mar) → 56.2 (Apr) → 55.5 (May) → 54.9 (Jun) → 54.1 (Jul) → 54.6 (Aug) → 53.2 (Sep) → 52.0 (Oct)

Eurozone Economic Sentiment Indicator (base 2010=100)

114.9 (Jan 2018) → 114.1 (Feb) → 112.7 (Mar) → 112.7 (Apr) → 112.5 (May) → 112.3 (Jun) → 112.1 (Jul) → 111.6 (Aug) → 110.9 (Sep) → 109.8 (Oct)

Eurozone’s GDP growth and industrial production (%)

(%)

6 4

0 -2

-1

-4

-2

-6 -8

-3

GDP (q-o-q, left) Industrial production (q-o-q, right)

-10

-4

-12 2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Source: Eurostat

(Percentage change from previous period)

2016

2017

Annual Annual Q1

2018

Jul

Aug Sep

0.4

0.2

Real GDP

1.9

2.4

0.6

0.7

Industrial production

1.6

2.9

0.0

1.0

1.8

1.2 -0.7 -0.2

-0.7

1.0

Retail sales

1.6

2.3

0.3

0.8

0.4

0.8

-0.6 -0.2

Exports (y-o-y)

0.3

7.1 11.2

5.4

6.0

6.1

2.1

4.2

9.3

5.6

Consumer prices (y-o-y)

0.2

1.5

1.4

1.3

1.7

2.1

2.0

2.1

Sources: Eurostat, Bloomberg

1.8

November 2018

2. Private consumption Private consumption (advanced estimates of GDP) in the third quarter of 2018 rose 0.6 percent compared to the previous quarter and 2.6 percent compared to a year ago. (Percentage change from previous period)

2016

2.5

(y-o-y)

2018

Q4 Annual Q1

Q21 Q31

-0.2 0.8

0.5

0.3

2.6

0.5

1.0

0.8

1.0

0.7

0.3

0.6

2.4

2.8

1.4

2.1

2.4

2.6

3.4

3.5

2.8

2.6

Annual Q1

Private consumption2

2017

3.6

1. Preliminary 2. National accounts Source: Bank of Korea

Private consumption (%)

8 6 4 2 0 -2 -4

Private consumption (y-o-y) Private consumption (q-o-q)

-6 2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Source: Bank of Korea (national accounts)

Retail sales in September fell 2.2 percent from the previous month: Sales of semi-durable goods (up 1.8%) picked up, but sales of durable goods (down 7.6%) and nondurable goods (down 1.1%) decreased. Year-on-year, the index rose 0.5 percent. (Percentage change from previous period)

2016

2017

Annual Annual

Retail sales

2018

Q31

Aug1 Sep1

3.9

1.9

0.4

1.0

0.2

0.9

3.0

0.7

-0.5

0.1

-2.2

1.6

1.0

3.2

2.1

5.0

4.7

3.9

5.9

0.5

4.6

5.4

1.0

5.2

-3.0

1.4

5.4

2.2

-4.9

3.1

-7.6

2.8

0.9

-0.5

3.5

-6.9

1.4

11.0

3.8

0.5

-0.3

-0.9

- Semi-durable goods

2.3

-1.1

-1.3

-0.5

1.1

1.4

2.8

1.0

1.9

-1.5

1.8

- Nondurable goods

4.2

1.7

0.8

-0.5

1.4

0.5

2.1

-0.3

0.6

-0.6

-1.1

(y-o-y) - Durable goods

Âˇ Automobiles 3

1. Preliminary 2. Durable goods: Automobiles, electronic appliances, furniture, telecommunications devices and etc. 3. Semi-durable goods: Clothing, footwear and etc. 4. Nondurable goods: Food, medicine, cosmetics, fuel, tobacco and etc. Source: Statistics Korea

Economic Bulletin

The Green Book

Retail sales (%)

-5

Retail sales (y-o-y)

-10 2009.1

Retail sales (m-o-m)

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

Retail sales by type (y-o-y, %)

30 25 20 15 10 5 0 Durable goods Semi-durable goods Nondurable goods

-5 -10 -15 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

In October large discount store sales, as well as consumer sentiment, dropped, but credit card use and department store sales increased. 2018 Mar

Credit card use (y-o-y, %)

1.2

Department store sales (y-o-y, %)

5.5

Large discount store sales (y-o-y, %)

3.1

Domestic sales of cars (y-o-y, %)

-3.5

Consumer sentiment index Number of Chinese tourists (y-o-y, %)

Apr 14.1

May

Jun

Aug

Sep

Oct1

9.7

8.8

1.9

13.2

Jul

5.2

7.7

0.5

2.0

5.0

3.2

2.9

4.3

3.9

-2.0

-3.0

0.9

-2.5

2.0

7.5

-12.2

1.3

-0.3

-5.9

3.3

6.8

-18.7

22.7

108.1

107.1

107.9

105.5

101.0

99.2

100.2

99.5

11.8

60.9

46.1

49.0

45.9

41.0

36.4

36.22

1. â&#x20AC;&#x152; Preliminary 2. â&#x20AC;&#x152;Advanced estimates based on all Chinese entries, which can be different from the statistic released by the Ministry of Culture, Sports and Tourism as it excludes diplomatic and military personnel Sources: Bank of Korea, Credit Finance Association of Korea, Korea National Oil Corporation, Korea Automobile Manufacturers Association, data provided by retail industries

November 2018

3. Facility investment Facility investment (advanced estimates of GDP) in the third quarter of 2018 fell 4.7 percent quarter-on-quarter and 7.7 percent year-on-year. (Percentage change from previous period)

2016

2017

2018

Annual

Annual1

Q11

Q21

Q31

Q41

Q11

Q21

Q31

-1.0

14.6

4.5

4.3

0.2

-0.7

3.4

-5.7

-4.7

16.1

17.9

16.3

8.6

7.3

-3.0

-7.7

- Machinery

-0.8

23.0

7.1

3.9

2.4

-1.2

4.0

-4.5

- Transportation equipment

-1.5

-3.2

-1.7

5.3

-5.5

0.8

1.9

-9.3

Facility investment2 (y-o-y)

1. Preliminary 2. National accounts Source: Bank of Korea

Facility investment (%)

40 30 20 10 0 -10 -20

Facility investment (y-o-y)

-30 2009.Q1

Facility investment (q-o-q)

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Source: Bank of Korea (national accounts)

Facility investment by type (y-o-y, %)

40 30 20 10 0 -10 -20

Machinery Transportation equipment

-30 2009.Q1

2010.Q1

2011.Q1

2012.Q1

Source: Bank of Korea (national accounts)

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Economic Bulletin

The Green Book

The facility investment index in September rose 2.9 percent month-on-month as machinery investment increased. The index fell 19.3 percent year-on-year. (Percentage change from previous period)

2016

2017

Annual Annual

Facility investment index

2018

Q31

Aug1 Sep1

-6.2

-1.6

-1.3

14.1

6.0

3.1

0.2

-1.7

8.4 -11.0

18.2

17.8

20.6

2.0

9.4

-5.9 -13.7 -11.3 -19.3

- Machinery

-2.2

22.4

6.6

7.9

-0.1

-2.0

5.3

-9.5 -10.0

- Transportation equipment

0.9

-4.4

5.1

-8.7

0.4

-0.8

(y-o-y)

17.8 -15.5

4.2

2.9

-4.2

11.5

4.8 -15.3

1. Preliminary Source: Statistics Korea

Leading indicators fell, except domestic machinery orders received. BSI in the manufacturing sector (base=100, Bank of Korea)

81 (May 2018) → 79 (Jun) → 80 (Jul) → 73 (Aug) → 77 (Sep) → 78 (Oct) → 72 (Nov) (Percentage change from same period in previous year)

2016

2017

Annual Annual

2018 Q3

Q31 Aug1 Sep1

4.2

4.4

-0.4

0.7

0.3

-8.9

Domestic machinery orders received

4.7

(q-o-q, m-o-m)

-Public

49.0

-21.8

-Private

1.1

24.1 22.5 26.3 34.1 15.0

Machinery imports

-2.5

18.8 24.2 20.5 22.7

72.9

72.6 73.5 72.0 73.0 71.8 71.0 73.2 74.3 75.7 73.9

Capacity utilization rate Facility investment pressure

19.2 21.1 23.7 31.3

-0.4

0.5

6.7

1.9

-8.6 11.4

1.4

7.2

2.5 12.6 -12.9

8.4

-0.9 -54.0 -12.7 18.9

-2.5 239.3 26.6

2.6

-5.8

0.2

3.9

6.1

9.1 20.9

-4.7

-2.5

-1.7

0.9

-1.6

1.1

-1.3 -13.2 -12.6 -18.1

1.5

-0.7

3.5

-7.0

1. Preliminary 2. Production growth rate minus production capacity growth rate in the manufacturing sector (%p) Sources: Statistics Korea, Korea International Trade Association

Leading indicators of facility investment (trillion won)

(y-o-y, %)

10 9

8 7

6 0

5 4

-20

Machinery orders (left) Machinery imports (right)

-40

2 2009.Q1

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Sources: Statistics Korea (machinery orders), Korea International Trade Association (machinery imports)

November 2018

4. Construction investment Construction investment (advanced estimates of GDP) in the third quarter of 2018 fell 6.4 percent quarter-on-quarter and 8.6 percent year-on-year. (Percentage change from previous period)

2016

2017

Annual

Annual1

10.3

7.6

Construction investment

(y-o-y)

Q11

Q21

2018 Q31

Q41

Q11

Q21

Q31

4.2

0.9

1.1

-2.3

1.8

-2.1

-6.4

11.3

8.5

8.0

3.8

1.8

-1.5

-8.6

- Building construction

16.2

12.1

4.5

2.4

1.9

-1.6

0.7

-1.1

- Civil engineering works

-1.8

-3.5

3.5

-3.0

-1.2

-4.2

5.3

-4.7

1. Preliminary

2. National accounts Source: Bank of Korea

Construction investment (%)

-5

Construction investment (y-o-y)

-10 2009.Q1

Construction investment (q-o-q)

2010.Q1

2011.Q1

2012.Q1

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Source: Bank of Korea (national accounts)

Construction investment by type (y-o-y, %)

40 30 20 10 0 -10

Building construction Residential buildings Civil engineering works

-20 -30 2009.Q1

2010.Q1

2011.Q1

2012.Q1

Source: Bank of Korea (national accounts)

2013.Q1

2014.Q1

2015.Q1

2016.Q1

2017.Q1

2018.Q1

Economic Bulletin

The Green Book

Construction completed (constant) in September decreased 3.8 percent monthon-month as both building construction and civil engineering works declined. The index decreased 16.6 percent year-on-year. (Percentage change from previous period)

2016

2017

Annual Annual

Construction completed (constant)

2018

Q31 Aug1 Sep1

15.4

10.1

4.3 -0.2 -0.3 -0.1

2.5 -4.9 -4.3 -0.6 -3.8

17.7 13.6 12.7 -0.5

1.5 -3.4 -9.6 -5.4 -16.6

- Building construction

25.7

18.2

5.8

- Civil engineering works

-2.6

-8.4

0.6 -6.5 -6.2

(y-o-y)

1. Preliminary

2.2

1.8 -0.9 2.3

0.8 -2.3 -4.5 -0.2 -2.8 7.4 -12.3 -3.5 -2.1 -7.2

Source: Statistics Korea

Leading indicators show mixed signals: Apartment presales increased, but construction orders received and building permits declined. Apartment presales (thousands, monthly average of the quarter, Real Estate 114)

19 (Q1 2017) → 27 (Q2) → 30 (Q3) → 34 (Q4) → 17 (Q1 2018) → 37 (Q2) → 22 (Q3) → 16 (Sep) → 25 (Oct) (Percentage change from same period in previous year)

2016

2017

Annual Annual

Construction orders received (current value)

8.1

(q-o-q, m-o-m)

- Building construction - Civil engineering works 2

Building permits

2018 Q3

Q31 Aug1 Sep1

1.2 17.9 -10.2 -15.0

3.6 -15.7

-6.4 -27.3

-5.4

8.5 -10.6

8.0 -11.1

5.9 -21.7 16.3

14.4

-6.5

-7.7

8.4

-10.5

9.7 29.7 63.3 -17.3 -13.0 13.0 -19.1 68.0

-5.7

-3.1

-4.0

-5.0

-7.8

-1.1

-8.3 -15.5

-0.3

-2.4

-6.6

-0.5 -14.7 -24.8 -35.5 -26.4

3.7

-1.1 101.3

-7.2 -10.2 -16.4 -33.2

1. Preliminary 2. Floor area Sources: Statistics Korea, Ministry of Land, Infrastructure and Transport

Leading indicators of construction investment (y-o-y, %)

200 150 100 50 0 -50

Construction orders

-100 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Building permit area

Sources: Statistics Korea (construction orders), Ministry of Land, Infrastructure and Transport (building permit area)

November 2018

5. Exports and imports Exports (preliminary) increased 22.7 percent year-on-year to US $54.97 billion in October, the second largest on record. By item, petroleum products, machinery, petrochemicals and auto parts rose, while wireless communications devices and vessels dropped. By region, shipments to Japan, India, the US, China, Vietnam, Latin America and the EU increased, while exports to the Middle East declined. Export growth by item (y-o-y, %)

75.5 (petroleum products), 51.7 (machinery), 42.9 (petrochemicals), 36.9 (auto parts), -18.2 (wireless communications devices), -55.0 (vessels)

Export growth by region (y-o-y, %)

50.5 (Japan), 48.6 (India), 47.6 (US), 45.0 (Latin America), 37.1 (EU), 17.7 (China), 10.2 (Vietnam), -3.9 (Middle East)

Although average daily exports, an indicator adjusted to days worked, fell 4.0 percent year-on-year in October, it amounted to US $2.39 billion, the third largest on record. Average daily export growth (y-o-y, %)

-4.1 (Apr 2018) → 10.2 (May) → 6.6 (Jun) → 3.9 (Jul) → 8.7 (Aug) → 10.6 (Sep) → -4.0 (Oct)

Exports by item (y-o-y, %)

140 120 100 80 60 40 20

Export growth rate Semiconductors Automobiles Steel

0 -20 -40 -60 -80 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Sources: Korea Customs Service, Ministry of Trade, Industry and Energy (export and import trends) (US $ billion)

2016 Annual

Exports

2017 Annual

2018 Q3

495.43 573.69 132.06 147.04 151.05 143.54

Oct

44.79 145.07 151.66 153.58

Oct1 54.97

(y-o-y, %)

-5.9

15.8

14.7

16.7

24.0

8.4

6.7

9.9

3.1

1.7

22.7

Average daily exports

1.81

2.13

1.96

2.21

2.13

2.23

2.49

2.17

2.30

2.28

2.39

1. Preliminary Source: Korea Customs Service

Economic Bulletin

The Green Book

Imports (preliminary) in October rose 27.9 percent year-on-year to US $48.42 billion. Imports of commodities, capital goods and consumer goods all increased, commodities imports growing faster. Import growth by category (y-o-y, %, Sep → Oct)

9.8 → 38.4 (commodities), -15.1 → 10.9 (capital goods), -7.8 → 34.9 (consumer goods)

Imports by category (y-o-y, %)

100 80 60 40 20 0 -20 -40

Import growth rate Commodities Capital goods

-60 -80 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Sources: Korea Customs Service, Ministry of Trade, Industry and Energy (export and import trends)

(US $ billion)

2016

Imports

2017 Q1

2018

Annual

406.19

478.48 116.43 117.80 120.85 123.40

Oct

Oct1

37.86 132.37 132.99 130.32

48.42

(y-o-y, %)

-6.9

17.8

24.1

18.6

17.9

11.6

8.0

13.7

12.9

7.8

27.9

Average daily imports

1.49

1.78

1.72

1.77

1.70

1.91

2.10

1.98

2.02

1.93

2.11

1. Preliminary Source: Korea Customs Service

The trade balance (preliminary) posted a surplus of US $6.55 billion in October, staying in the black for the 81st consecutive month. Surpluses decreased monthon-month. (US $ billion)

2016

2017

Annual Annual

Trade balance

89.23

1. Preliminary Source: Korea Customs Service

2018 Q3

95.22 15.63 29.25 30.20 20.14

Oct 6.93

Oct1

12.70

18.66

23.26

6.55

November 2018

6. Mining and manufacturing production Mining and manufacturing production fell 2.5 percent month-on-month in September due to weak manufacturing and gas & electricity production. Production improved in mining. The index fell 8.4 percent year-on-year. Compared to the previous month, production of nonferrous metals (up 5.1%), refined petroleum (up 2.0%) and chemical products (up 0.6%) rose, while automobiles (down 4.8%), electronic components (down 7.8%) and electrical equipment (down 6.0%) fell. Compared to a year ago, production of semiconductors (up 15.4%), precision medical optics (up 7.0%) and refined petroleum (up 3.0%) rose, while automobiles (down 15.1%), processed metals (down 19.4%) and mechanical equipment (down 13.0%) declined. The manufacturing inventory-shipment ratio fell 0.5 percentage points month-onmonth to 106.7 percent as inventories fell 1.2 percent and shipments were down 0.7 percent. Inventories of automobiles (up 4.0%), chemical products (up 3.0%) and electrical equipment (up 1.2%) rose, while primary metals (down 5.2%), broadcasting & communications equipment (down 17.7%) and semiconductors (down 2.1%) declined. Shipments of chemical products (up 30.8%), primary metals (up 9.2%) and automobiles (up 8.1%) rose, while mechanical equipment (down 13.4%), electronic components (down 8.0%) and audiovisual equipment (down 34.3%) fell. The capacity utilization rate of the manufacturing sector declined 1.8 percentage points month-on-month to 73.9 percent. Mining and manufacturing outlooks are mixed: Strong exports are expected to continue amid recovering global economies, but trade conflicts are ongoing between the US and China, Fed may raise rates again this year, and oil prices remain high. (Percentage change from same period in previous year)

2017 Annual Q3

Q31

Jul

Aug1 Sep1

0.8

0.3

2.7

0.7

0.6

1.3

-2.5

(y-o-y)

1.9

4.6 10.0

0.7

-1.7

1.0

2.5

-8.4

(q-o-q, m-o-m)

0.6

3.0

0.4

0.1

1.6

-2.1

(y-o-y)

1.6

4.6 10.6

0.5

-2.2

0.9

2.0

-8.9

Shipment

0.7

4.3 10.2

-0.8

-3.1

-0.8

0.8

-9.0

-Domestic consumption

1.4

6.1 12.6

-1.3

-5.2

-2.2

0.1 -12.7

-Exports

-0.3

1.8

6.9

-0.1

-0.3

1.2

2.0

-3.9

Inventory3

8.8

2.5

8.2

4.9

4.4

4.9

Production

Capacity utilization rate Production capacity 1. Preliminary

(q-o-q, m-o-m)

Mining and manufacturingÂ˛

Manufacturing

2018 Sep

72.6 73.0 72.7 73.2 74.3 73.2 75.7 73.9 1.1

0.7

0.6

2. Including mining, manufacturing and gas & electricity production

-1.0

-1.5

-1.2

-1.5

3. At the end of the period

-1.9

Economic Bulletin

The Green Book

Industrial production (%)

50 40 30 20 10 0 -10 -20

Industrial production (y-o-y)

-30 2009.1

Industrial production (m-o-m)

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

Shipment and inventory (m-o-m, %)

8 6 4 2 0 -2 -4

Shipment growth

-6 2009.1

Inventory growth

2010.1

2011.1

2012.1

Source: Statistics Korea (industrial activity trends)

Capacity utilization rate (%)

90 85 80 75 70 65 60 2009.1

2010.1

2011.1

2012.1

2013.1

Source: Statistics Korea (industrial activity trends)

November 2018

7. Service sector activity Service output in September remained unchanged from the previous month. Financial & insurance services and real estate & renting rose, while wholesale & retail declined. Compared to a year ago, service output fell 1.4 percent.

Service sector activity (%)

10 8 6 4 2 0 -2 Service sector activity (y-o-y) Service sector activity (m-o-m)

-4 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

(Percentage change from previous period)

Weight

2016 2017 Annual Annual

2018 Q1

Q31

Aug1

Sep1

Service activity index

100.0

2.6

1.9

1.0

0.2

0.0

- Wholesale & retail

21.1

2.6

0.7

1.0

-0.6

0.0

0.1

-2.0

- Transportation & storage services

9.0

2.2

1.6

-0.6

3.7

-1.0

-1.4

1.0

- Hotels & restaurants

6.2

2.3

-1.9

-2.0

1.6

0.3

-1.2

2.1

- Publishing & communications services

8.0

2.5

1.5

-2.0

1.0

1.6

-1.5

14.1

4.1

5.1

1.4

1.0

-1.5

-0.1

1.4

- Real estate & renting

3.2

0.6

1.2

5.1

-0.6

0.2

-1.1

5.4

- Professional, scientific & technical services

7.1

-0.8

-1.6

3.2

0.0

-1.5

-0.1

-3.3

- Business services

4.8

1.5

4.3

0.2

-1.9

-1.2

-0.4

-0.7

- Education services

10.6

0.7

0.0

0.1

0.4

-0.2

-2.4

0.0

- Healthcare & social welfare services

9.4

8.1

7.0

1.5

-0.2

6.4

6.2

1.3

- Entertainment & leisure

2.2

2.3

0.2

2.0

-1.7

-0.9

-1.8

4.6

- Membership organizations & personal services

3.2

0.3

0.0

1.4

0.1

-1.9

-4.2

-0.7

- Sewerage & waste management

1.1

3.1

-2.3

2.3

1.0

-0.5

-6.1

-3.3

- Financial & insurance services

1. Preliminary Source: Statistics Korea

Economic Bulletin

The Green Book

September 2018 service output by business (y-o-y, %) 10

Healthcare & social welfare services

8 6 Financial & insurance services

4 2 0

Total index

Transportation & storage services

-2 -4 Wholesale & retail

-6

Publishing & communications services Hotels & restaurants

Professional, scientific & technical services

Real estate & renting

Membership organizations & personal services

Education services

Business services

Entertainment & leisure

-8

Sewerage & waste management

-10

Source: Statistics Korea (industrial activity trends)

Wholesale & retail (%)

10 8 6 4 2 0 -2 -4

Wholesale & retail (y-o-y) Wholesale & retail (m-o-m)

-6 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

In October large discount store sales and stock transactions declined, but domestic sales of cars increased, as well as department store sales. 2018 Sep

Oct1

3.3

6.8 -18.7

22.7

5.0

3.2

2.9

Mar

Apr

May

Jun

Domestic sales of cars (y-o-y, %)

-3.5

1.3

-0.3

-5.9

Department store sales (y-o-y, %)

5.5

0.5

2.0

Large discount store sales (y-o-y, %)

Jul

Aug

3.1

-2.0

-3.0

0.9

-2.5

2.0

Average daily stock transactions (trillion won) 12.4

14.3

15.0

12.5

9.0

8.8

Number of Chinese tourists (y-o-y, %)

60.9

46.1

49.0

45.9

41.0

11.8

4.3

3.9

7.5 -12.2 10.8

9.6

36.4 36.22

1. Preliminary 2. â&#x20AC;&#x152; Advanced estimates based on all Chinese entries, which can be different from the statistic released by the Ministry of Culture, Sports and Tourism as it excludes diplomatic and military personnel Sources: Korea Automobile Manufacturers Association, Korea Exchange, data provided by retail industries

November 2018

8. Employment The number of workers on payroll in September increased by 45,000 from a year earlier to 27,055,000, and the employment rate (aged 15-64) fell 0.1 percentage points to 66.8 percent. By industry, construction jobs continued to grow, while jobs in manufacturing and services declined at a slower rate. By employment status, permanent workers led job growth, while self-employed, temporary and daily workers continued to decrease.

Employment by industry (%)

100

71.9 71.5 71.1 70.6 70.2 70.1 70.4 70.6 70.4 70.3 70.5 70.9 71.1 71.2 70.9 70.3 70.0 70.1 70.1 70.2 69.9

Services Construction Manufacturing

7.3

7.4

7.5

7.4

7.3

7.5

7.6

7.7

7.6

7.5

7.6

17.4 17.5 17.2 17.0 17.0 17.1 17.0 16.9 16.9 16.9 17.0 17.4 17.6 17.5 17.1 16.6 16.7 16.5 16.6 16.5 16.7

3.4

3.7

2017.1 2

Agriculture, forestry & fisheries

4.4

5.0

5.3

5.4

5.2

5.3

5.0

4.0

12 2018.1 2

4.2

3.7

3.8

4.5

5.2

5.5

5.4

5.5

3.9

4.2

4.3

4.4

4.3

4.4

4.3

Source: Statistics Korea (employment trends)

Employment by status of workers (%)

100

3.7

3.8

4.0

4.3

4.4

4.3

4.4

3.7

21.3 21.4 21.4 21.3 21.2 21.2 21.2 21.3 21.3 21.4 21.1 21.0 21.1 21.2 21.2 21.2 21.1 21.0 21.1 21.1 21.0

80 5.7

5.5

5.4

5.8

5.9

5.4

5.6

5.7

5.6

5.4

5.2

5.3

5.4

5.2

5.5

60 18.4 18.3 18.6 18.7 18.9 19.0 18.9 18.8 18.7 18.7 18.8 18.5 17.8 17.5 18.1 18.3 18.4 18.4 18.5 18.1 18.0

Unpaid family workers

Self-employed workers

50.8 51.0 50.6 49.9 49.7 49.6 49.8 50.2 50.0 50.0 50.2 51.1 52.0 52.4 51.5 50.9 50.8 50.8 50.7 51.3 51.2

Daily workers Temporary workers

2017.1 2

Regular workers

Source: Statistics Korea (employment trends)

12 2018.1 2

Economic Bulletin

The Green Book

Number of persons employed and employment growth (thousands)

(millions)

1,000

800

600

400

200

-200

Employment growth (y-o-y, left) 21

-400 2009.1

Number of employed (seasonally adjusted, right)

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (employment trends)

2017 Annual

Number of employed (millions)

2018 Q3

Sep

26.73 26.10 26.92 27.00 26.88 27.01 26.28 27.02 27.02 27.06

Employment rate (%)

60.8

59.6

61.3

61.4

61.0

614

59.6

61.2

61.1

61.2

(Seasonally adjusted)

60.8

60.9

60.8

60.9

609

60.9

60.7

60.5

60.6

- 15 to 64

66.6

65.8

66.9

67.0

66.9

658

66.0

66.9

66.7

66.8

Employment growth (y-o-y, thousands)

316

353

367

279

265

353

183

101

- Manufacturing

-18

-120

-21

41 -120

-91

-42

- Construction

119

136

163

136

- Services

209

360

224

144

103

360

125

-5

-74

-50

· Hotels & restaurants

-3

-31

-40

-24

-69

-86

· Healthcare & social welfare services

148

142

133

· Wholesale & retail

- Wage workers

-87 -100

265

191

312

291

265

191

228

113

117

·Permanent workers

366

317

347

417

382

317

409

335

293

330

·Temporary workers

-132

-152 -126 -145 -104 -152 -124 -109 -162 -190

·Daily workers - Nonwage workers ·Self-employed workers

-13

-57 -113

-67

-24

161

-12

161

-45

-13

-48

-72

168

-24

-3

-55

-83

- Male

127

171

174

171

-14

-48

-13

- Female

189

182

192

187

193

182

109

115

- 15 to 29

-1

-7

-42

-69

-27

- 30 to 39

-29

-53

-27

-18

-17

-53

-29

-33

-91 -104

- 40 to 49

-50

-41

-48

-55

-54

-41

-85 -101 -143 -123

- 50 to 59

152

177

159

139

134

177

- 60 and above

242

254

251

221

243

254

203

241

252

233

Source: Statistics Korea

November 2018

The number of unemployed persons in September was up by 92,000 from a year earlier to 1,024,000, and the unemployment rate rose 0.3 percentage points to 3.6 percent. The unemployment rate rose in all age groups except young adults, compared with a year ago.

Unemployment rate (%)

Original data

2 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Seasonally adjusted rate

Source: Statistics Korea (employment trends)

2017

2018

Annual

Number of unemployed (thousands)

1,023

1,162

1,074

963

892

932

1,181

1,105

1,065 1,024

Unemployment growth (y-o-y, thousands)

-20

-51

102

- Male

-15

-8

-1

-12

-28

-50

Unemployment rate (%)

3.7

4.3

3.8

3.4

3.2

3.3

4.3

3.9

3.8

3.6

(Seasonally adjusted)

3.7

3.8

4.0

- 15 to 29

9.8

10.7

10.3

9.3

9.0

9.2

10.0

10.1

9.4

8.8

- 30 to 39

3.3

3.6

3.4

3.0

2.8

3.3

3.6

- 40 to 49

2.1

2.4

2.0

1.8

1.9

2.5

2.6

2.4

- 50 to 59

2.2

2.4

2.3

1.8

2.3

2.5

2.6

2.4

- 60 and above

2.9

4.8

2.3

2.2

2.0

5.4

2.5

2.3

2.5

- Female

Source: Statistics Korea

Sep

Economic Bulletin

The Green Book

The economically inactive population in September increased 114,000 from a year earlier to 16,158,000, and the labor force participation rate was unchanged at 63.5 percent. The number of persons economically inactive due to rest (up 89,000) and housework (up 92,000) increased, and those due to education (down 172,000) and childcare (down 80,000) decreased. Job seekers were up by 62,000.

Labor force participation rate (%)

65 64 63 62 61 60

Original data Seasonally adjusted rate

59 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (employment trends)

2017 Annual

Economically inactive population (millions)

2018 Q3

Sep

16.18 16.56 15.91 16.01 16.26 16.04 16.62 16.02 16.13 16.16

Labor force participation rate (%)

63.2

62.2

63.8

63.6

63.1

63.5

62.3

63.7

63.5

(Seasonally adjusted)

63.2

63.1

63.2

63.3

63.1

-5

-20

-85

110

126

114

-96

-86

-88

-105

-107

-103

-80

-87

-86

-80

-33

-12

- Education

-91

-63

-131

-88

-81

-80

-58

-62

-128

-172

- Old age

108

166

220

190

107

127

138

-10

Growth in economically inactive population (y-o-y, thousands) - Childcare - Housework

- Rest - Job seeking Source: Statistics Korea

November 2018

9. Financial markets 9.1 Stock market KOSPI declined 13.4 percent in October from 2,343.1 points to 2,029.7 points amid continuing trade conflicts between the US and China, as well as concerns over Italyâ&#x20AC;&#x2122;s budget crisis. KOSDAQ dropped 21.1 percent from 822.3 points to 648.7 points. (Closing rate)

KOSPI Sep 2018 Oct 2018

KOSDAQ Change

Sep 2018 Oct 2018

Change1

Stock price index (points)

2,343.1

2,029.7 -313.4 (-13.4%)

822.3

648.7 -173.6 (-21.1%)

Market capitalization (trillion won)

1,567.6

1,361.5 -206.1 (-13.1%)

273.3

216.6

-56.7 (-20.7%)

Daily trade (trillion won) Foreign stock ownership (%, %p)

6.1

0.03 (0.5%)

4.7

3.5

-1.2 (-26.4%)

36.1

36.7

0.6 (1.6%)

11.1

-0.0 (-0.4%)

1. Change from the end of the previous month as of end-October 2018 Source: Korea Exchange

Stock prices (monthly average, points)

2,700 2,400 2,100 1,800 1,500 1,200 900 600 KOSPI KOSDAQ

300 2009.1

2010.1

Source: Korea Exchange

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Economic Bulletin

The Green Book

9.2 Exchange rate The dollar-won exchange rate rose 2.7 percent in October from 1,109.3 won to 1,139.6 won as global stock markets fell and the yuan weakened. The 100 yen-won exchange rate rose 2.9 percent from 977.7 won to 1,006.5 won amid falling risk appetite. (Closing rate1)

2012

2013

2014

2015

2016

2017

Dec

Sep

Oct

Change2

1,070.6

1,055.4

1,099.3

1,172.5

1,207.7

1,070.5

1,109.3

1,139.6

-2.7

100 Yen-Won 1,238.3

1,002.3

913.0

974.1

1,035.4

949.3

977.7

1,006.5

-2.9

Dollar-Won

2018

1. The exchange rate is based on the closing price at 3:30 p.m., local time. ‌ 2. Appreciation from the end of the previous month as of end-October 2018 (%) Source: Bank of Korea

Foreign exchange rates (month-end, ₩)

1,600

1,400

1,200

1,000

Dollar-Won 100 Yen-Won

800 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Bank of Korea

9.3 Bond market Korea treasury yields declined in October as the Bank of Korea decided to hold its benchmark interest rate steady at 1.50 percent and lowered its growth forecast from 2.9 percent to 2.7 percent this year, as well as on concerns over China’s economic slowdown. Yield to maturity (m-o-m, basis points)

-6.6 (3 yrs), -10.9 (5 yrs), -11.4 (10 yrs), -14.9 (20 yrs), -15.9 (30 yrs)

November 2018

(Closing rate, %)

2012

2013

2014

2015

2016

2017

2018

Dec

Aug

Sep

Oct

Call rate (1 day)

2.77

2.52

2.03

1.52

1.27

1.58

1.55

1.65

1.57

-8.0

CD (91 days)

2.89

2.66

2.13

1.67

1.52

1.66

1.65

1.70

5.0

Treasury bonds (3 yrs)

2.82

2.86

2.10

1.66

1.64

2.14

1.92

2.01

1.94

-6.6

Corporate bonds (3 yrs)

3.29

2.43

2.11

2.13

2.68

2.42

2.45

2.39

-5.6

Treasury bonds (5 yrs)

2.97

3.23

2.28

1.81

1.80

2.34

2.11

2.18

2.07

-10.9

Change1

1. Basis points, %p, change from the previous month as of end-October 2018 Source: Bank of Korea

Interest rates (monthly average, yearly, %)

8 7 6 5 4 3 2

3-yr corporate bond yield

3-yr Treasury bond yield

0 2009.1

Overnight call rate (daily)

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Bank of Korea

9.4 Money supply and money market M2 (monthly average) in August rose 6.7 percent from a year ago as private sector credit continued to increase, led by businesses. (Percentage change from same period in previous year, average)

2011

2012

2013

2014

2015

2016

2017

Annual

Jul

Aug

Aug1

M12

6.6

3.8

9.5

10.9

18.6

15.4

9.2

4.8

4.0

837.6

4.2

5.2

4.8

6.6

8.6

7.3

5.5

6.7

2,651.5

5.3

7.8

6.9

7.0

9.7

8.1

6.7

7.1

3,718.5

2018

1. Balance at end-August 2018, trillion won 2. M1 excludes corporate MMFs and individual MMFs, and includes CMAs 3. Liquidity aggregates of financial institutions (mostly identical with M3) Source: Bank of Korea

Economic Bulletin

The Green Book

Total money supply (y-o-y, monthly average balance, %)

35 30 25 20 15 10

Reserve money

0 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Bank of Korea

Bank deposits increased 15.4 trillion won in September: Instant access deposits rose 16.7 trillion won as surplus funds flowed in from corporations and Chuseok bonuses flowed in from households. Asset management company (AMC) deposits decreased 13.4 trillion won: Money market funds (MMFs) fell 17.4 trillion won as banks withdrew funds at the end of the quarter to meet their BIS ratio requirements and also as the government took out funds for fiscal spending. (Change from the end of the previous period, trillion won)

2011

2012

2013

2014

2015

2016

2017

Annual Annual Annual Annual Annual Annual Annual

2018 Jul

Aug

Sep

Sep1

Bank deposits

58.9

37.0

41.0 115.4 100.3

80.8

79.5

-8.6

6.5

15.4 1,616.6

AMC deposits

-16.6

18.8

17.7

47.6

27.9

24.3

-10.4

-13.4 541.6

42.4

44.4

1. Balance at end-September 2018 Source: Bank of Korea

Deposits in financial institutions (m-o-m, end of month balance, trillion won)

60 50 40 30 20 10 0 -10 -20 2009.1

2010.1

Source: Bank of Korea

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

November 2018

10. Balance of payments Korea’s current account (preliminary) in September posted a surplus of US $10.83 billion, staying in the black for 79 consecutive months. Goods account surpluses increased month-on-month from US $11.24 billion to US $13.24 billion. Growth in goods exports (y-o-y, %) 11.7 (Aug 2018) → -5.5 (Sep)

Growth in goods imports (y-o-y, %) 9.2 (Aug 2018) → -3.2 (Sep)

Export growth by item in September (y-o-y, %, customs clearance basis)

-8.2 (total), 14.0 (petroleum products), 5.6 (computers), 28.3 (semiconductors), -35.8 (home appliances)

Import growth by category in September (y-o-y, %, customs clearance basis) -1.6 (total), 9.8 (commodities), -15.1 (capital goods), -7.8 (consumer goods)

Services account deficits increased month-on-month from US $2.11 billion to US $2.52 billion. Services balance (US $ billion, Aug → Sep)

-0.33 → 0.03 (transportation), 1.00 → 0.67 (construction), 0.00 → -0.43 (intellectual property rights), -0.66 → -0.64 (manufacturing), -1.54 → -1.13 (travel), -0.79 → -1.17 (others)

Surpluses in the primary income account increased from US $0.05 billion to US $0.67 billion, and deficits in the secondary income account decreased from US $0.73 billion to US $0.56 billion.

Current account balance (US $ billion)

18 15 12 9 6 3 0

Goods account Services account Current account

-3 -6 2009.1

2010.1

2011.1

2012.1

2013.1

Source: Bank of Korea (balance of payments trends)

2014.1

2015.1

2016.1

2017.1

2018.1

Economic Bulletin

The Green Book

(US $ billion)

2016

2017

Annual Annual1 Q11

Current account

99.24

Q21

2018

Q31

Q41

Sep1

Q11

Q21

Q31

Sep1

78.46 19.20 16.45 25.57 17.24 12.29 11.83 17.83 28.03 10.83

- Goods balance

118.90 119.89 27.31 29.56 34.75 28.27 14.98 23.91 31.78 35.91 13.24

- Services balance

-17.74 -34.47 -8.66 -6.75 -8.50 -10.56 -2.88 -9.41 -6.53 -7.75 -2.52

- Primary income balance

3.85

- Secondary income balance -5.77

0.12 1.37 -4.88 1.95

1.68 1.25 0.39 -5.17 1.94 0.67

-7.08 -0.82 -1.48 -2.63 -2.15 -1.06 -3.06 -2.26 -2.07 -0.56

1. Preliminary Source: Bank of Korea

The capital and financial account (preliminary) in September posted an outflow of US $9.73 billion. Capital & financial account balance* (US $ billion)

0.01 (Apr 2018) → 6.75 (May) → 4.63 (Jun) → 10.46 (Jul) → 7.28 (Aug) → 9.73 (Sep) * Positive figures represent net outflows, and negative figures represent net inflows.

Net outflows decreased in foreign direct investment (FDI) (US $4.38 billion in August → US $2.17 billion in September) as Korean FDI (US $5.57 billion outflow → US $2.47 billion outflow) grew slower than inbound FDI (US $1.20 billion inflow → US $0.30 billion inflow). Net outflows increased in portfolio investment (US $1.49 billion in August → US $9.13 billion in September): Korean investment in foreign shares rose (US $7.17 billion outflow → US $7.72 billion outflow) while foreign investment in Korean shares declined (US $5.68 billion inflow → US $1.40 billion outflow). Net outflows decreased in financial derivatives investment (US $0.76 billion → US $0.44 billion) and other investment shifted from a net outflow of US $1.88 billion to a net inflow of US $3.91 billion. Current account surpluses are likely to decrease in October given a fall in trade surpluses (US $9.60 billion in September → US $6.60 billion in October).

Capital & financial account balance (US $ billion)

15 12 9 6 3 0 -3

Capital & financial account

-6

Direct investment

-9

Portfolio investment Financial derivatives

-12 2009.1

2010.1

2011.1

2012.1

2013.1

Source: Bank of Korea (balance of payments trends)

2014.1

2015.1

2016.1

2017.1

2018.1

November 2018

11. Prices 11.1 Consumer prices Consumer prices in October fell 0.2 percent from the previous month and rose 2.0 percent from the same period of the previous year.

Consumer price inflation (%)

6 5 4 3 2 1 0

Consumer price inflation (y-o-y) Consumer price inflation (m-o-m)

-1 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (consumer price trends) (Percentage change)

2018 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Consumer price inflation (m-o-m) 0.4

0.8

-0.1

0.1

-0.2

0.2

0.5

0.7

-0.2

(y-o-y)

1.4

1.3

1.6

1.5

1.4

1.9

2.0

1.0

Source: Statistics Korea

Fresh food prices fell 4.1 percent month-on-month as heatwaves subsided and supplies improved. Year-on-year, fresh food prices rose 8.1 percent due to a low base effect. Domestic oil prices went up at a faster pace (up 10.7% → up 11.8%, y-o-y) amid rising international oil prices and a weak won. Public utility prices continued to fall (down 1.8% → down 1.9%, y-o-y) due to the ongoing effect of last year’s natural gas rate cuts. Public service prices continued to decline (down 0.1% → down 0.1%, y-o-y) as the expanded coverage of national health insurance lowered medical costs, and also due to low phone bills. Personal service prices rose at a slower rate (up 2.4% → up 2.2%, y-o-y) due to a high base effect from the previous year, and also as more schools adopted free lunch programs.

Economic Bulletin

The Green Book

Consumer price inflation in major sectors Total

Agricultural, Manufactured Public Housing Public Personal Oil livestock & utilities rents services services fishery products products products

Sep (y-o-y, %)

1.9

7.1

1.9

10.7

-1.8

0.5

-0.1

2.4

Oct (y-o-y, %)

2.0

8.1

2.0

11.8

-1.9

0.5

-0.1

2.2

0.67

0.62

0.53

-0.07

0.04

-0.01

0.70

- Contribution (%p) Source: Statistics Korea

Contribution to consumer price inflation (%p)

5 4 3

Personal services

Public services 1

Housing rents Public utilities

Manufactured products

-1

Agricultural, livestock & fishery products

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Source: Statistics Korea (consumer price trends)

Core inflation, which excludes oil and agricultural products, decelerated in October. (Percentage change from same period in previous year)

2018 Mar Apr May Jun

Jul

Aug Sep

Oct

Consumer prices excluding oil and agricultural products 1.3

1.4

1.3

1.2

1.1

0.9

1.2

1.1

Consumer prices excluding food and energy

1.4

1.2

1.0

0.9

1.4

Source: Statistics Korea

The fresh food price index rose at a faster rate (up 8.6% â&#x2020;&#x2019; up 10.5%, y-o-y) in October as heatwaves pushed up fruit and vegetable prices. (Percentage change from same period in previous year)

2018 Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Consumer prices for basic necessities

1.1

1.4

1.5

1.3

2.2

2.4

Fresh food prices

1.0

4.7

4.5

2.0

0.1

3.2

8.6

10.5

Source: Statistics Korea

November 2018

Prices (y-o-y, %)

Consumer price inflation Core inflation

-3

-6 2009.1

Producer price inflation

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Sources: Statistics Korea (consumer price trends), Bank of Korea (producer prices)

11.2 International oil and commodity prices International oil prices continued to rise until the first week of October due to supply concerns, but have fallen since then. Dubai crude (US $/barrel)

82.9 (1st week Oct 2018) → 81.5 (2nd week) → 78.9 (3rd week) → 76.3 (4th week) → 74.6 (5th week)

International oil prices (US $/B)

140 120 100 80 60 40 20 WTI Dubai crude

0 2009.1

2010.1

2011.1

Source: Korea National Oil Corporation

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Economic Bulletin

The Green Book

(US $/barrel, period average)

2017

2018

Annual

Jul

Aug

Sep

Oct

Dubai crude

53.2

64.0

72.1

74.2

73.1

72.5

77.2

79.4

WTI crude

50.9

62.9

67.9

69.4

70.6

67.8

70.1

70.8

Brent crude

54.7

67.2

75.0

75.8

75.0

73.8

79.1

80.6

Source: Korea National Oil Corporation

Domestic gasoline prices continued to rise in October due to time lags between international and domestic gasoline price movements. Domestic gasoline prices (won/liter)

1,659.6 (1st week Oct 2018) → 1,674.9 (2nd week) → 1,686.3 (3rd week) → 1,689.7 (4th week) → 1,690.0 (5th week)

International gasoline prices (US $/barrel)

87.4 (3rd week Sep 2018) → 89.5 (4th week) → 91.7 (1st week Oct) → 89.6 (2nd week) → 84.6 (3rd week)

Dollar-won exchange rate (won)

1,122 (3rd week Sep 2018) → 1,117 (4th week) → 1,115 (1st week Oct) → 1,133 (2nd week) → 1,130 (3rd week) → 1,134 (4th week)

Dubai crude prices and import prices (thousand won/B)

Dubai crude (import prices, left)

(US $/B)

160

140

120

100

20 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Dubai international prices (right)

Source: Korea National Oil Corporation (Won/liter, period average)

2017

2018

Annual

Jul

Aug

Sep

Oct

Gasoline prices

1,491

1,558

1,580

1,622

1,611

1,618

1,638

1,681

Diesel prices

1,283

1,353

1,380

1,423

1,412

1,419

1,439

1,485

Source: Korea National Oil Corporation

November 2018

International corn and soybean prices rose in October as bad weather delayed harvests, and wheat prices fell as the US raised its output forecast. International grain prices in October (monthly average prices, m-o-m, %) 2.7 (corn), -1.0 (wheat), 2.6 (soybeans)

Copper prices rose due to stronger-than-expected demand from China, and aluminum prices went up due to a shutdown of production facilities in Brazil. Nickel prices fell on economic downturn concerns. Nonferrous metal prices in October (monthly average prices, m-o-m, %) 3.3 (copper), 0.6 (aluminum), -1.6 (nickel)

(Period average)

2017 1

Reuters Index

(Sep 18, 1931=100)

2018

Annual

Jul

Aug

Sep

Oct

2,472

2,342

2,317

2,309

2,298

2,329

2,299

2,392

1. A weighted average index of 17 major commodities Source: KOREA PDS

International commodity prices (points)

(points)

4,000

500 450

3,000

400 350

2,000

300 250 200

1,000

150

CRB (left)

100 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Reuters index (right)

Source: KOREA PDS * â&#x20AC;&#x152; CRB demonstrates a futures price index of 21 commodities listed on the US Commodity Transaction Market, including beans and other crops, crude oil and jewelry.

Economic Bulletin

The Green Book

12. Real estate market 12.1 Housing market Housing prices nationwide rose 0.19 percent month-on-month in October. Housing prices rose 0.42 percent in the Seoul metropolitan area which includes Seoul (up 0.51%), Gyeonggi Province (up 0.42%) and Incheon (up 0.15%). Housing prices rose 0.18 percent in the five metropolitan cities and declined 0.15 percent in the eight provinces. Housing prices in five metropolitan cities (m-o-m, %)

Busan (-0.09), Daegu (0.56), Gwangju (0.61), Daejeon (0.57), Ulsan (-0.76)

Housing sales prices

(Percentage change from previous period)

2014 2015 2016

2017

Annual Annual Annual Annual

2018

Oct

Jan-Oct

Jul

Aug

Sep

Oct

Nationwide

1.7

3.5

0.7

1.5

0.17

1.0

-0.02

0.02

0.31

0.19

Seoul metropolitan area

1.5

4.4

1.3

2.4

0.26

3.0

0.11

0.24

0.70

0.42

- Seoul

1.1

4.6

2.1

3.6

0.43

6.0

0.32

0.63

1.25

0.51

Âˇ Gangnam

1.2

5.2

2.5

4.4

0.56

6.5

0.26

0.62

1.45

0.45

Âˇ Gangbuk

1.1

3.9

1.8

2.9

0.30

5.4

0.38

0.64

1.04

0.57

1.9

2.7

0.2

0.7

0.08

-0.8

-0.13

-0.17

-0.04

-0.02

Areas excluding the Seoul metropolitan area

1. Upscale area of Southern Seoul 2. Northern Seoul Source: Korea Appraisal Board

Housing sales prices (m-o-m, %)

-1

Nationwide Seoul metropolitan area Areas excluding Seoul metropolitan area

-2 2009.1

2010.1

2011.1

Source: Korea Appraisal Board

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

November 2018

Housing rental prices nationwide declined 0.05 percent month-on-month in October. Housing rental prices rose 0.06 percent in the Seoul metropolitan area and fell 0.15 percent in areas excluding the Seoul metropolitan area. Housing rental prices in major districts in the Seoul metropolitan area (m-o-m, %)

Gangnam (0.21), Seocho (0.11), Seongdong (0.41), Mapo (0.53), Yeongdeungpo (0.42), Gwacheon (1.17)

Housing rental prices (m-o-m, %)

-1

Nationwide Seoul metropolitan area Areas excluding Seoul metropolitan area

-2 2009.1

2010.1

2001.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Korea Appraisal Board

Housing rental prices

(Percentage change from previous period)

2014 2015 2016

2017

Annual Annual Annual Annual

2018

Oct

Jan-Oct

Jul

Aug

Sep

Oct

Nationwide

3.4

4.8

1.3

0.6

0.06

-1.5

-0.21

-0.20

-0.08

-0.05

Seoul metropolitan area

4.7

7.1

2.0

1.4

0.12

-1.2

-0.18

-0.12

0.04

0.06

- Seoul

3.6

7.2

2.0

0.14

0.4

0.06

0.20

0.26

0.17

Âˇ Gangnam

3.3

7.9

1.8

2.6

0.16

-0.1

0.07

0.29

0.36

0.18

Âˇ Gangbuk

3.8

6.5

2.1

1.5

0.12

0.9

0.04

0.10

0.15

0.17

2.2

2.8

0.7

-0.1

0.00

-1.8

-0.24

-0.27

-0.19

-0.15

Areas excluding the Seoul metropolitan area

1.Upscale area of Southern Seoul 2. Northern Seoul Source: Korea Appraisal Board

There were 76,141 housing transactions in September, up 15.5 percent from a month earlier (65,945) and down 9.7 percent from a year ago (84,350).

Housing transactions 2016

2017

Annual Annual

Nationwide

(Thousands)

2018

Oct Nov Dec Jan Feb Mar Apr May Jun

Jul

Aug Sep

1. Monthly average Source: Ministry of Land, Infrastructure and Transport

Economic Bulletin

The Green Book

Housing transactions (thousands)

150

125

100

Nationwide Seoul metropolitan area

0 2009.1

Areas excluding Seoul metropolitan area

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Ministry of Land, Infrastructure and Transport

12.2 Land market Land prices nationwide rose 0.43 percent month-on-month in September. Land prices rose 0.52 percent in the Seoul metropolitan area which includes Seoul (up 0.68%), Gyeonggi Province (up 0.37%) and Incheon (up 0.36%). Land prices in Seoul metropolitan area (m-o-m, %)

0.33 (Feb 2018) → 0.36 (Mar) → 0.34 (Apr) → 0.36 (May) → 0.40 (Jun) → 0.46 (Jul) → 0.49 (Aug) → 0.52 (Sep)

Land price growth has been decelerating in areas excluding the Seoul metropolitan area. Land prices in areas excluding Seoul metropolitan area (m-o-m, %)

0.28 (Feb 2018) → 0.33 (Mar) → 0.32 (Apr) → 0.32 (May) → 0.31 (Jun) → 0.31 (Jul) → 0.30 (Aug) → 0.28 (Sep)

Land prices

(Percentage change from previous period)

2014

2015

2016

2017

2018

Annual Annual Annual Annual Jan-Oct

Jul

Aug

Sep

Nationwide

1.96

2.40

2.70

3.88

3.33

0.99

1.05

1.25

0.40

0.42

0.43

Seoul

2.66

2.69

2.97

4.32

4.30

1.28

1.09

1.87

0.56

0.61

0.68

Gyeonggi

1.24

1.73

2.23

3.45

3.20

0.83

1.17

1.16

0.38

0.41

0.37

Incheon

1.35

1.95

1.74

3.10

2.42

0.65

0.82

0.94

0.29

0.28

0.36

Source: Korea Appraisal Board

November 2018

There were 232,000 land transactions in September, down 6.4 percent from the previous month (248,000) and down 21.0 percent from a year ago (293,000). Land transactions (m-o-m, %)

Incheon (-4.9), South Chungcheong Province (-22.2), Sejong (-30.2), South Jeolla Province (-26.4)

Vacant land transactions decreased 22.2 percent from the previous month (85,000 â&#x2020;&#x2019; 66,000) accounting for 28.6 percent of the total land transactions. The index fell 29.4 percent compared with a year ago (94,000).

Land transactions

(Land lots, thousands)

2016

2017

Annual Annual

Nationwide

2018

Oct

Nov Dec Jan

Feb Mar Apr May Jun

Jul

Aug Sep 248 232

250

276

238

294

296

298

252

320

265

271

255

272

Seoul

Gyeonggi

Incheon

1. Monthly average Source: Korea Land & Housing Corporation

Land transactions (thousand mÂ˛)

300,000

250,000

200,000

150,000

100,000

50,000

Seoul metropolitan area 0

Areas excluding Seoul metropolitan area

2009.1

2010.1

Source: Korea Appraisal Board

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Economic Bulletin

The Green Book

13. Composite indices of business cycle indicators Industrial output fell 1.3 percent month-on-month in September. Mining & manufacturing (down 2.5%), construction (down 3.8%) and public administration (down 2.5%) declined while services stayed flat. Compared to a year ago, industrial output fell 4.8 percent.

Index of all industry production (%)

-5

Industrial output (y-o-y) Industrial output (m-o-m)

-10 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

The cyclical indicator of the coincident composite index declined 0.3 points month-on-month to 98.6. Among the seven components of the coincident composite index, two rose, while the other five either fell or remained unchanged. Components of the coincident composite index in September (m-o-m)

service output (0.3%), domestic shipments (0.1%), mining & manufacturing production (-0.3%), value of construction completed (-1.2%), retail sales (-0.6%), imports (-0.5%), nonfarm payroll employment (0.0%)

The cyclical indicator of the leading composite index fell 0.2 points from the previous month to 99.2. Two components of the leading composite index rose, while the other six either declined or remained unchanged. Components of the leading composite index in September (m-o-m)

inventory circulation indicator (0.9%p), value of construction orders received (6.7%), consumer expectations index (-2.3p), ratio of job openings to job seekers (-1.3%p), KOSPI (-1.3%), spreads between long & short term interest rates (-0.12%p), domestic shipments of machinery (0.0%), ratio of export to import prices (0.0%)

November 2018

Cyclical indicator of coincident composite index (points)

110

105

100

90 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

2016.1

2017.1

2018.1

Source: Statistics Korea (industrial activity trends)

Cyclical indicator of leading composite index (points)

110

105

100

90 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

Source: Statistics Korea (industrial activity trends)

2018 Index of all industry production (m-o-m, %) (y-o-y, %) Coincident composite index (2015=100) (m-o-m, %) Cyclical indicator of coincident composite index (m-o-m, p) Leading composite index (2015=100) (m-o-m, %)

Feb

Mar

Apr

May

-0.2

-0.9

1.4

0.3

-1.2

-0.6

1.9

1.7

Jul1

Aug1

Sep1

-0.6

0.7

0.5

-1.3

0.2

1.4

1.6

-4.8

Jun

108.5 108.8 108.9 109.1 109.2 109.2 109.2 109.2 0.3

0.3

0.1

0.2

0.1

0.0

99.8

99.7

99.6

99.4

99.1

98.9

98.6

0.0

-0.1

-0.2

-0.3

-0.2

-0.3

112.2 112.3 112.3 112.8 113.0 113.3 113.2 113.4 0.2

0.3

-0.1

0.2

Cyclical indicator of leading composite index 100.6 100.4 100.1 100.1 100.0 (m-o-m, p) -0.2 -0.2 -0.3 0.0 -0.1

99.8

99.4

99.2

-0.2

-0.4

-0.2

1. Preliminary

0.2

0.1

0.0

0.4

Economic News Briefing

Korea ranks 5th in WB Doing Business 2019 Index Koreaâ&#x20AC;&#x2122;s exports expected to exceed US $600 billion this year Government to launch a tech fund worth 340 billion won Koreaâ&#x20AC;&#x2122;s external debt rises to US $449.5 billion, soundness indicators stable Korea grows 0.6% in Q3 2018 (advanced)

November 2018

Korea ranks 5th in WB Doing Business 2019 Index Korea ranks fifth among 190 countries in World Bank’s Ease of Doing Business Index for 2019. Although Korea went down by one notch compared to the previous year, the country has been placed among the top five for five consecutive years. Of the 10 indicators to show the ease of doing business, Korea continues to rank high, compared with the previous year, in “enforcing contracts” (1st → 2nd), “getting electricity” (2nd → 2nd) and “starting a business” (9th → 11th), shows improvement in “dealing with construction permits” (28th → 10th), and is placed lower in areas such as “registering property” (39th → 40th) and “getting credit” (55th → 60th).

Korea’s exports expected to exceed US $600 billion this year Korea’s exports are expected to surpass US $600 billion this year for the first time on record. As of October 29, the country’s exports amounted to more than US $500 billion, due to strong exports of high value-added products, as well as increased shipments to FTA partner countries.

Government to launch a tech fund worth 340 billion won The government announced on November 1 its plan to launch a new fund for open innovation and new technologies. The 340 billion won worth of Government Industrial Fund for Technology and Services (GIFTs) will consist of 140 billion won worth of investment funds, as well as loans worth 200 billion won. If companies are proved technologically innovative, they will be able to take out loans with interest rates at least 1.3 percentage points lower than the market rate, and will also be eligible for GIFTs funding.

Korea’s external debt rises to US $449.5 billion, soundness indicators stable Korea’s external debt amounts to US $449.5 billion as of September 2018, and its net foreign assets in debt instruments totals US $462.2 billion. The ratio of short-term debt to total debt is 28.5 percent and the ratio to foreign exchange reserves is 31.8 percent.

Economic Bulletin

Economic News Briefing

Korea grows 0.6% in Q3 2018 (advanced) Koreaâ&#x20AC;&#x2122;s real gross domestic product (GDP) expanded 0.6 percent quarter-on-quarter in the third quarter of 2018, according to the advanced data released by the Bank of Korea (BOK) on October 25. Compared to a year ago, the Korean economy grew 2.0 percent. On the production side, agriculture, forestry & fisheries contracted 4.9 percent compared to the previous quarter. Manufacturing grew 2.3 percent backed by strong semiconductors, as well as increasing electric and electronic equipment. Construction decreased 5.3 percent as both building construction and civil engineering works declined. Services grew 0.5 percent due to strong wholesale & retail, hotels & restaurants and healthcare & social welfare services. On the expenditure side, private consumption increased 0.6 percent backed by strong sales of nondurable and semi-durable goods, while government consumption rose 1.6 percent as expenditures on health care benefits increased. Construction investment contracted 6.4 percent as building construction and civil engineering works both fell, and facility investment declined 4.7 percent due to weak machinery. Intellectual property investment rose 1.0 percent. Exports increased 3.9 percent as semiconductors continued to be strong, and imports decreased 0.1 percent due to a decline in machinery imports. GDP by production and expenditure*

(Percentage change from previous period)

2016 Q1 GDP

20171 Q4

20181 Q4

0.8 0.4 0.7 1.0 0.6 1.4 -0.2 1.0 0.6 0.6 0.6 (3.0)2 (3.5)2 (2.7)2 (2.6)2 (2.9)2 (2.8)2 (3.8)2 (2.8)2 (2.8)2 (2.8)2 (2.0)2

Agriculture, forestry & fisheries

1.5

-3.2

-1.4

-1.1

3.9

-0.3

-1.8

0.2

6.0

-2.8

Manufacturing

0.0

1.3

-0.1

1.8

1.7

0.1

2.7

-1.7

1.6

0.6

-4.9 2.3

Construction

3.7

2.0

2.3

2.2

4.8

-1.6

1.0

-1.6

2.1

-3.1

-5.3

Services3

0.6

0.4

0.7

1.0

0.3

1.1

0.5

Private consumption

-0.2

0.8

0.5

0.3

0.5

1.0

0.8

1.0

0.7

0.3

0.6

Government consumption

1.7

0.6

0.7

0.5

0.6

1.2

1.9

0.5

2.2

0.3

1.6

Construction investment

5.6

3.2

2.2

1.0

4.2

0.9

1.1

-2.3

1.8

-2.1

-6.4

Facility investment

-7.1

2.7

1.6

6.5

4.5

4.3

0.2

-0.7

3.4

-5.7

-4.7

Intellectual property investment

0.9

1.5

0.7

0.3

0.5

1.5

1.1

0.3

-0.7

1.0

Exports

-0.2

0.8

1.4

-0.6

2.1

-2.7

5.6

-5.3

4.4

0.4

3.9

Imports

-1.3

2.3

2.4

0.1

4.9

-1.0

3.2

-2.9

4.9

-3.0

-0.1

*Based on 2010 chained prices in seasonally adjusted terms 1. Preliminary 2. Percentage change from the same period of the previous year (original data) 3. â&#x20AC;&#x152; Wholesale & retail, hotels & restaurants, transportation & storage, communications services, financial & insurance services, real estate & renting, business services, public administration, defense, education services, healthcare & social welfare services, entertainment, cultural & other services are included.

Statistical Appendices

01. National accounts 02. Production, shipment and inventory 03. Production capacity and operation ratio 04. Consumer goods sales index 05. Machinery orders received and facility investment index 06. Value of construction completed and domestic construction orders received 07. Composite indices of business cycle indicators, CSI and BSI 08. Prices 09. Employment (I) 10. Employment (II) 11. Balance of payments (I) 12. Balance of payments (II) 13. Financial indicators 14. Monetary indicators 15. Exchange rates

Economic Bulletin

Statistical Appendices

1. National accounts (year-on-year change, %, chained 2010 year prices)

Real GDP

Period 2010 2011 2012 2013 2014 2015 2016 2017p 2010 Ⅰ Ⅱ Ⅲ Ⅳ 2011 Ⅰ Ⅱ Ⅲ Ⅳ 2012 Ⅰ Ⅱ Ⅲ Ⅳ 2013 Ⅰ Ⅱ Ⅲ Ⅳ 2014 Ⅰ Ⅱ Ⅲ Ⅳ 2015 Ⅰ Ⅱ Ⅲ Ⅳ 2016 Ⅰ Ⅱ Ⅲ Ⅳ 2017p Ⅰ Ⅱ Ⅲ IV 2018p Ⅰ II III p: Preliminary Source: Bank of Korea

Agri., forestry & fisheries

6.5 3.7 2.3 2.9 3.3 2.8 2.9 3.1 7.3 7.4 5.4 6.0 4.9 3.6 3.3 3.0 2.5 2.4 2.1 2.2 2.1 2.7 3.2 3.5 3.9 3.5 3.3 2.7 2.6 2.4 3.0 3.2 3.0 3.5 2.7 2.6 2.9 2.8 3.8 2.8 2.8 2.8 2.0

-4.3 -2.0 -0.9 3.1 3.6 -0.4 -2.8 0.3 0.0 -2.2 -7.8 -5.7 -9.3 -2.5 -5.8 7.1 0.1 -1.8 0.0 -1.3 -1.2 0.1 4.3 7.0 5.9 4.5 2.7 2.4 8.5 -3.0 0.3 -4.0 -2.4 1.1 -4.5 -4.6 -1.9 0.5 0.4 1.5 4.1 1.2 -1.8

Final consumption Manufacturing expenditure 13.7 6.5 2.4 3.6 3.5 1.8 2.4 4.4 16.1 17.2 10.1 11.9 11.4 6.5 5.6 3.4 2.7 2.8 2.0 2.0 2.7 3.6 3.8 4.2 4.7 4.7 3.1 1.8 1.1 0.9 2.2 2.7 2.1 2.7 1.7 2.9 4.8 3.6 6.4 2.7 2.7 3.2 2.8

4.3 2.7 2.2 2.2 2.0 2.4 3.0 2.8 6.2 3.6 3.9 3.4 3.3 3.3 2.8 1.7 2.2 1.3 2.7 2.7 1.5 2.2 2.4 2.6 2.9 1.8 2.0 1.6 1.8 2.0 2.3 3.5 3.0 3.8 3.3 1.9 2.2 2.5 3.0 3.5 4.0 3.3 3.2

Gross fixed capital formation Private consumption

4.4 2.9 1.9 1.9 1.7 2.2 2.5 2.6 6.8 3.6 4.0 3.2 3.7 3.7 2.5 1.7 1.6 0.7 2.6 2.7 1.5 1.9 1.9 2.2 2.8 1.7 1.4 1.1 1.4 1.7 2.2 3.5 2.4 3.6 2.8 1.4 2.1 2.4 2.6 3.4 3.5 2.8 2.6

Construction

5.5 0.8 -0.5 3.3 3.4 5.1 5.6 8.6 12.0 6.8 3.8 1.3 -0.7 2.5 1.7 -0.3 6.2 -2.3 -0.9 -3.6 -3.2 4.2 4.9 6.5 6.2 3.7 3.6 0.7 3.8 3.8 6.0 6.5 3.2 5.2 5.8 7.8 11.0 10.0 9.2 5.0 3.7 -1.3 -6.5

-3.7 -3.4 -3.9 5.5 1.1 6.6 10.3 7.6 1.6 -4.8 -4.8 -5.1 -8.2 -2.5 -2.2 -2.0 -0.2 -5.3 -2.6 -6.4 1.2 8.9 7.5 3.5 4.5 0.3 2.3 -1.7 4.0 4.6 7.6 9.6 8.4 9.4 11.0 11.9 11.3 8.5 8.0 3.8 1.8 -1.5 -8.6

Facilities

22.0 4.7 0.1 -0.8 6.0 4.7 -1.0 14.6 27.6 28.8 20.6 12.9 8.3 8.3 3.4 -0.9 11.0 -1.9 -4.2 -3.8 -12.3 -3.2 2.3 11.7 7.5 8.1 4.3 4.1 5.1 4.1 6.1 3.5 -3.6 -1.6 -2.5 3.3 16.1 17.9 16.3 8.6 7.3 -3.0 -7.7

November 2018

2. Production, shipment and inventory (constant prices, 2015=100)

Period 2016 2017 2016 2017

Ⅰ Ⅱ Ⅲ Ⅳ I Ⅱ Ⅲ Ⅳ 2018 I II IIIp 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8p 9p

Production index*

Shipment index*

y-o-y change (%)

102.3 104.2 98.6 102.1 100.2 108.4 103.2 104.3 104.8 104.3 100.9 105.0 103.0 98.8 91.6 105.3 99.6 102.5 104.2 103.1 98.5 99.0 104.9 109.0 111.3 100.3 98.6 110.6 103.3 104.3 105.4 104.8 100.8 108.9 99.0 107.8 106.0 104.5 91.9 106.3 104.3 105.6 105.1 105.9 103.3 99.8

2.3 1.9 1.4 2.2 1.9 3.7 4.7 2.2 4.6 -3.8 -2.2 0.7 -1.7 -0.9 3.3 2.0 -1.7 5.5 3.0 2.8 4.0 -1.0 -0.7 6.2 5.6 1.5 7.6 5.0 3.7 1.8 1.2 1.6 2.3 10.0 -5.6 -1.1 -4.8 4.2 -6.8 -3.9 1.0 1.2 -0.3 1.0 2.5 -8.4

Inventory index*

y-o-y change (%)

101.2 102.1 98.4 101.6 98.0 106.7 101.1 102.7 102.6 102.2 97.9 102.1 99.7 97.2 91.2 106.8 100.0 101.7 103.1 100.3 96.2 97.6 102.5 106.7 110.8 97.2 97.0 109.2 101.8 101.9 104.3 101.6 98.6 107.5 96.3 106.9 103.3 100.5 89.2 103.9 100.5 103.3 102.4 101.1 99.6 98.1

1.2 0.9 0.4 1.3 0.1 2.7 2.7 1.1 4.7 -4.2 -3.2 -0.6 -2.8 -2.7 1.6 2.4 -1.5 3.8 1.8 0.7 1.6 -1.7 -2.5 5.1 5.4 0.0 6.4 2.2 1.8 0.2 1.2 1.3 2.5 10.1 -6.0 0.2 -6.8 3.4 -8.0 -4.9 -1.3 1.4 -1.8 -0.5 1.0 -8.7

* Including mining, manufacturing, electricity & gas and water industry p: Preliminary Source: Statistics Korea

Service production index

y-o-y change (%)

97.8 106.4 107.1 103.5 101.0 97.8 101.2 103.6 103.5 106.4 111.8 112.1 108.6 105.4 106.2 107.1 105.7 105.6 103.5 105.2 102.6 101.0 100.8 101.3 97.8 101.6 101.7 101.2 103.7 107.1 103.6 106.9 107.0 103.5 107.3 106.3 106.4 110.9 110.7 111.8 113.5 112.9 112.1 111.6 111.9 108.6

-1.6 8.8 10.5 3.4 -1.2 -1.6 -5.5 0.1 2.5 8.8 10.5 8.2 4.9 9.4 9.1 10.5 6.7 6.9 3.4 1.8 -1.0 -1.2 -0.9 -0.2 -1.6 -3.6 -4.2 -5.5 -1.9 1.4 0.1 1.6 4.3 2.5 6.4 4.9 8.8 9.2 8.7 10.5 9.5 5.4 8.2 4.4 4.6 4.9

y-o-y change (%)

102.6 104.5 98.7 102.8 102.4 106.6 100.9 104.5 105.0 107.6 103.5 106.9 105.8 97.4 95.3 103.4 101.4 102.7 104.4 102.1 102.4 102.6 103.5 103.3 112.9 99.6 97.5 105.6 103.1 104.5 106.0 103.5 103.9 107.5 102.1 106.5 114.1 103.0 99.3 108.1 105.9 106.9 107.8 105.8 105.7 106.0

2.6 1.9 2.4 3.3 3.0 1.8 2.2 1.7 2.5 0.9 2.6 2.3 0.8 2.3 2.4 2.5 2.1 3.3 4.5 2.8 3.9 2.3 1.5 2.3 1.7 2.3 2.3 2.1 1.7 1.8 1.5 1.4 1.5 4.8 -1.4 3.1 1.1 3.4 1.8 2.4 2.7 2.3 1.7 2.2 1.7 -1.4

Economic Bulletin

Statistical Appendices

3. Production capacity and operation ratio (constant prices, 2015=100)

Period 2016 2017 2016 Ⅰ Ⅱ Ⅲ Ⅳ 2017 Ⅰ Ⅱ Ⅲ Ⅳ 2018 Ⅰ II IIIp 2016 1 2 3 4 5 6 7 8 9 10p 11p 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8p 9p

Production capacity index* (2010=100)

Operation ratio index* (2010=100)

y-o-y change (%)

102.8 103.9 101.2 102.0 103.4 104.4 103.4 103.7 104.1 104.3 103.1 102.7 102.5 101.0 101.0 101.7 101.7 101.9 102.3 103.0 103.3 103.9 104.3 104.4 104.6 103.4 103.2 103.5 103.6 103.8 103.7 103.9 104.0 104.5 104.5 104.4 104.1 103.2 103.3 102.9 102.6 102.8 102.7 102.7 102.4 102.5

* Manufacturing industry p: Preliminary Source: Statistics Korea

2.8 1.1 1.9 2.4 3.3 3.4 2.2 1.7 0.7 -0.1 -0.3 -1.0 -1.5 1.9 1.7 2.2 2.2 2.3 2.5 3.0 3.3 3.6 3.6 3.3 3.5 2.4 2.2 1.8 1.9 1.9 1.4 0.9 0.7 0.6 0.2 0.0 -0.5 -0.2 0.1 -0.6 -1.0 -1.0 -1.0 -1.2 -1.5 -1.9

98.2 97.1 95.8 100.3 95.5 101.4 95.9 98.3 98.1 96.0 92.7 99.2 96.4 95.8 88.9 102.6 97.7 101.1 102.0 99.6 93.2 93.6 99.0 103.0 102.3 92.7 91.7 103.3 97.0 98.4 99.6 98.3 94.1 101.9 92.0 100.2 95.8 95.0 84.1 98.9 97.9 100.2 99.4 98.8 96.6 93.8

y-o-y change (%)

Capacity utilization rate* (%)

-1.8 -1.1 -1.0 -1.0 -2.9 -2.0 0.1 -2.0 2.7 -5.3 -3.3 0.9 -1.7 -3.3 0.9 -0.5 -4.5 2.5 -0.9 -1.5 -1.2 -6.3 -6.2 1.2 -1.0 -3.2 3.1 0.7 -0.7 -2.7 -2.4 -1.3 1.0 8.9 -7.1 -2.7 -6.4 2.5 -8.3 -4.3 0.9 1.8 -0.2 0.5 2.7 -7.9

72.9 72.6 73.4 72.8 72.1 73.5 73.5 72.0 73.0 71.8 71.0 73.2 74.3 72.4 74.9 72.8 72.1 74.6 73.6 73.7 72.5 72.3 70.3 73.7 72.4 74.9 72.3 73.4 71.7 72.6 71.8 72.7 73.5 72.7 73.3 71.7 70.3 70.6 72.1 70.3 72.5 74.0 73.1 73.2 75.7 73.9

November 2018

4. Consumer goods sales index (constant prices, 2015=100)

Total

Period 2016 2017 2016 2017

Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ 2018 Ⅰ II IIIp 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8p 9p p: Preliminary Source: Statistics Korea

y-o-y change (%)

103.9 105.9 99.9 104.3 101.7 109.6 101.5 105.3 105.0 111.9 106.6 110.2 109.1 99.6 95.6 104.5 102.1 107.3 103.4 102.1 100.8 102.2 108.4 109.1 111.2 103.5 95.4 105.5 104.0 107.7 104.2 104.7 101.0 109.3 107.9 114.9 112.8 105.2 101.6 112.9 109.6 112.5 108.4 110.5 107.0 109.8

3.9 1.9 4.7 5.6 3.1 2.2 1.6 1.0 3.2 2.1 5.0 4.7 3.9 5.7 2.9 5.3 3.4 4.6 8.8 4.3 5.4 0.0 2.0 2.6 2.0 3.9 -0.2 1.0 1.9 0.4 0.8 2.5 0.2 6.9 -0.5 5.3 1.4 1.6 6.5 7.0 5.4 4.5 4.0 5.5 5.9 0.5

Consumer goods sales index Durable goods Semi-durable goods y-o-y change (%)

104.6 110.2 99.4 108.8 99.2 111.2 102.8 112.9 111.1 113.8 111.8 119.3 113.4 92.9 92.8 112.5 103.3 108.4 114.7 103.5 100.9 93.2 107.3 110.6 115.6 94.7 100.0 113.7 108.5 114.2 115.9 115.0 107.0 111.4 104.0 122.8 114.6 110.0 101.3 124.2 119.5 120.4 117.9 122.0 117.2 100.9

4.6 5.4 6.7 11.5 0.8 0.3 3.4 3.8 12.0 2.3 8.8 5.7 2.1 -1.4 7.7 13.3 8.2 12.3 13.9 0.2 5.5 -3.1 0.7 1.6 -1.3 1.9 7.8 1.1 5.0 5.4 1.0 11.1 6.0 19.5 -3.1 11.0 -0.9 16.2 1.3 9.2 10.1 5.4 1.7 6.1 9.5 -9.4

y-o-y change (%)

102.3 101.2 96.4 103.4 91.5 117.7 94.7 101.0 90.8 118.4 99.2 107.0 97.9 97.3 89.3 102.6 104.9 110.5 94.8 94.1 85.1 95.4 118.2 119.9 115.0 96.3 88.4 99.3 105.5 104.9 92.6 91.6 83.4 97.5 113.7 124.6 117.0 94.5 91.8 111.3 107.8 112.2 101.1 98.8 89.0 106.0

2.3 -1.1 2.0 4.2 3.3 0.1 -1.8 -2.3 -0.8 0.6 4.8 5.9 7.8 3.2 0.9 1.8 1.4 0.7 12.2 7.5 1.1 1.3 0.5 0.1 -0.3 -1.0 -1.0 -3.2 0.6 -5.1 -2.3 -2.7 -2.0 2.2 -3.8 3.9 1.7 -1.9 3.8 12.1 2.2 7.0 9.2 7.9 6.7 8.7

Nondurable goods

y-o-y change (%)

104.2 106.0 101.7 102.5 107.4 105.2 103.9 103.6 108.4 108.1 107.4 107.3 112.0 103.7 99.7 101.6 100.3 105.4 101.9 105.0 107.7 109.4 104.6 103.7 107.4 110.9 96.4 104.4 101.2 105.8 103.8 105.7 106.0 113.5 107.2 107.0 110.1 107.7 106.1 108.4 105.8 109.0 107.2 110.3 110.1 115.6

4.2 1.7 5.0 3.3 4.2 4.3 2.2 1.1 0.9 2.8 3.4 3.6 3.3 10.2 1.7 3.1 2.2 2.9 5.1 5.0 7.1 0.7 3.5 4.5 4.9 6.9 -3.3 2.8 0.9 0.4 1.9 0.7 -1.6 3.7 2.5 3.2 2.5 -2.9 10.1 3.8 4.5 3.0 3.3 4.4 3.9 1.9

Economic Bulletin

Statistical Appendices

5. Machinery orders received and facility investment index Period

2016 2017 2016 Ⅰ Ⅱ Ⅲ Ⅳ 2017 Ⅰ Ⅱ Ⅲ Ⅳ 2018 Ⅰ Ⅱ IIIp 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8p 9p

p: Preliminary Source: Statistics Korea

Domestic machinery orders received excluding ship (billion won, constant value) Total Public Private y-o-y change (%)

26,643 31,753 6,398 6,942 5,765 7,538 7,749 8,584 7,568 7,852 8,094 8,549 7,621 1,662 2,282 2,454 2,006 2,210 2,727 2,030 1,672 2,063 1,825 2,339 3,374 2,144 2,464 3,142 2,777 2,588 3,219 2,799 2,357 2,412 2,351 2,936 2,564 2,621 2,271 3,201 2,951 2,787 2,810 2,647 2,515 2,458

4.7 19.2 -0.9 -1.3 4.8 16.7 21.1 23.7 31.3 4.2 4.4 -0.4 0.7 -28.8 22.9 8.2 -27.6 5.2 26.3 1.0 2.5 11.0 -8.7 18.8 35.4 29.0 8.0 28.0 38.5 17.1 18.1 37.9 41.0 16.9 28.9 25.5 -24.0 22.3 -7.8 1.9 6.3 7.7 -12.7 -5.4 6.7 1.9

y-o-y change (%)

2,862 2,239 637 575 465 1,184 691 542 461 545 603 645 450 71 255 312 188 175 213 47 84 334 63 154 967 122 226 342 241 117 184 296 82 84 167 137 242 269 141 193 302 118 224 67 277 107

49.0 -21.8 57.4 16.8 16.6 89.9 8.4 -5.8 -0.9 -54.0 -12.7 18.9 -2.5 -39.0 80.7 110.8 48.7 -11.3 25.6 -64.6 -47.3 214.8 -35.2 -32.6 224.7 72.5 -11.1 9.8 28.1 -33.1 -13.5 526.3 -3.2 -74.8 162.8 -11.0 -75.0 120.7 -37.9 -43.6 25.2 1.4 21.8 -77.4 239.3 26.6

y-o-y change (%)

23,781 29,514 5,761 6,367 5,300 6,353 7,058 8,042 7,107 7,307 7,491 7,904 7,171 1,591 2,027 2,142 1,817 2,035 2,514 1,983 1,588 1,729 1,761 2,186 2,406 2,021 2,237 2,800 2,536 2,471 3,035 2,504 2,276 2,327 2,185 2,799 2,323 2,352 2,131 3,008 2,650 2,669 2,586 2,581 2,238 2,352

1.1 24.1 -4.8 -2.6 3.9 8.8 22.5 26.3 34.1 15.0 6.1 -1.7 0.9 -28.3 18.1 1.0 -31.3 6.9 26.3 5.7 7.9 -1.4 -7.4 25.5 9.6 27.0 10.4 30.7 39.5 21.4 20.7 26.3 43.3 34.6 24.0 28.1 -3.5 16.3 -4.8 7.4 4.5 8.0 -14.8 3.1 -1.6 1.1

Facility investment index (2010=100) y-o-y

change (%)

110.7 126.3 100.1 114.2 106.3 122.0 118.3 134.5 128.2 124.4 129.4 126.6 110.7 97.0 90.7 112.7 111.0 110.6 121.1 105.0 109.8 104.0 109.3 118.8 138.0 107.0 108.5 139.3 127.0 132.8 143.7 131.1 123.5 130.0 105.0 126.8 141.4 130.0 118.8 139.4 129.0 128.2 122.6 117.8 109.5 104.9

-1.3 14.1 -7.6 0.6 -4.7 5.9 18.2 17.8 20.6 2.0 9.4 -5.9 -13.7 -6.6 -8.4 -7.7 -2.5 2.5 2.1 -12.6 3.3 -4.0 -3.3 10.2 10.5 10.3 19.6 23.4 14.4 20.1 18.7 24.9 12.5 25.0 -3.9 6.7 2.5 21.5 10.3 0.1 1.6 -3.5 -14.7 -10.1 -11.3 -19.3

November 2018

6. Value of construction completed and domestic construction orders received (current value, billion won)

Period 2016 2017 2016 Ⅰ Ⅱ Ⅲ Ⅳ 2017 Ⅰ Ⅱ Ⅲ Ⅳ 2018 Ⅰ Ⅱ Ⅲp 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8p 9p

Total

Value of construction completed Public Private

y-o-y change (%)

119,971 138,484 24,533 29,977 29,573 35,889 30,579 35,562 34,841 37,502 32,259 35,792 32,826 7,509 7,424 9,600 9,027 9,347 11,603 9,545 9,832 10,195 10,473 11,458 13,959 8,986 9,593 12,000 11,229 11,253 13,080 11,204 11,104 12,534 10,829 12,137 14,536 10,693 9,827 11,739 11,525 11,433 12,834 10,997 10,950 10,880

p: Preliminary Source: Statistics Korea

16.9 15.4 11.9 16.5 16.3 21.5 24.6 18.6 17.8 4.5 5.5 0.6 -5.8 6.4 8.1 20.0 14.0 16.9 18.1 17.8 21.0 10.9 20.2 28.9 17.0 19.7 29.2 25.0 24.4 20.4 12.7 17.4 12.9 22.9 3.4 5.9 4.1 19.0 2.4 -2.2 2.6 1.6 -1.9 -1.8 -1.4 -13.2

y-o-y change (%)

30,916 30,143 6,710 8,099 7,061 9,046 6,937 8,075 6,880 8,250 6,491 7,628 6,324 2,045 1,976 2,689 2,317 2,326 3,456 2,256 2,344 2,460 2,348 2,779 3,920 1,970 2,129 2,838 2,302 2,429 3,344 2,233 2,075 2,572 2,175 2,456 3,619 1,929 1,910 2,652 2,260 2,348 3,019 2,131 1,956 2,237

-0.4 -2.5 0.4 -2.3 -2.6 2.6 3.4 -0.3 -2.6 -8.8 -6.4 -5.5 -8.1 -1.1 -6.8 7.8 -7.1 -1.4 0.6 -2.4 5.4 -9.2 2.4 12.7 -3.5 -3.6 7.7 5.5 -0.7 4.4 -3.2 -1.0 -11.5 4.6 -7.3 -11.6 -7.7 -2.1 -10.3 -6.6 -1.8 -3.3 -9.7 -4.6 -5.7 -13.0

Total

y-o-y change (%)

83,680 104,666 16,512 20,494 21,226 25,778 22,598 26,575 27,103 28,390 24,945 27,404 25,603 5,144 5,086 6,282 6,299 6,611 7,585 6,914 7,109 7,203 7,692 8,224 9,532 6,682 7,186 8,730 8,639 8,542 9,394 8,709 8,780 9,614 8,409 9,393 10,587 8,517 7,715 8,713 9,029 8,845 9,529 8,509 8,698 8,397

24.2 25.1 14.0 24.6 23.7 32.2 36.9 29.7 27.7 11.6 10.4 3.1 -5.5 7.9 12.3 21.1 23.2 24.3 26.0 25.2 27.0 19.2 27.3 36.5 32.7 29.9 41.3 39.0 37.2 29.2 23.9 26.0 23.5 33.5 9.3 14.2 11.1 27.5 7.4 -0.2 4.5 3.6 1.4 -2.3 -0.9 -12.7

Domestic construction orders received Public Private

y-o-y change (%)

145,386 140,844 28,922 32,790 36,709 46,966 29,273 38,675 32,958 39,938 29,950 32,593 30,848 7,335 9,994 11,593 10,848 9,658 12,284 12,006 13,329 11,374 14,793 12,624 19,548 8,527 12,350 8,397 14,647 11,450 12,578 8,470 12,745 11,743 8,258 11,129 20,551 11,885 7,946 10,509 9,209 12,670 10,714 10,610 9,264 10,973

8.1 -3.1 13.6 -7.3 0.6 26.4 1.2 17.9 -10.2 -15.0 2.3 -15.7 -6.4 -2.5 84.0 -7.4 19.2 -23.6 -9.9 38.3 52.0 -40.3 42.4 -4.7 44.6 16.3 23.6 -27.6 35.0 18.6 2.4 -29.4 -4.4 3.2 -44.2 -11.8 5.1 39.4 -35.7 25.2 -37.1 10.7 -14.8 25.3 -27.3 -6.6

y-o-y change (%)

33,832 33,468 7,753 5,565 7,914 12,600 7,290 7,542 6,986 11,650 4,818 6,296 6,324 2,687 2,354 2,712 1,185 2,127 2,254 2,626 3,362 1,925 3,209 2,792 6,600 2,246 3,091 1,953 2,122 1,486 3,934 1,811 3,031 2,144 905 2,306 8,438 1,325 2,271 1,225 1,449 2,739 2,108 1,621 2,230 2,472

18.5 -1.1 68.6 -37.9 61.5 24.9 -6.0 35.5 -11.7 -7.5 -33.9 -16.5 -9.5 102.9 106.4 27.1 -53.9 -10.2 -44.0 46.6 75.1 62.2 78.0 -14.5 31.5 -16.4 31.3 -28.0 79.1 -30.1 74.6 -31.0 -9.8 11.4 -71.8 -17.4 27.9 -41.0 -26.5 -37.3 -31.7 84.3 -46.4 -10.5 -26.4 15.3

y-o-y change (%)

107,748 102,327 20,458 26,702 26,985 33,603 17,914 30,375 25,830 28,209 20,794 25,520 23,169 4,371 7,559 8,528 9,295 7,412 9,995 8,513 9,464 9,008 11,509 9,729 12,365 6,277 5,912 5,725 11,915 9,906 8,554 6,638 9,701 9,491 7,330 8,805 12,075 6,339 5,660 9,183 7,491 9,772 8,257 8,921 5,872 8,375

4.4 -5.0 -0.6 3.1 -12.6 30.1 -12.4 13.8 -4.3 -16.1 16.1 -16.0 -10.3 -28.1 79.5 -17.2 43.6 -27.1 8.0 25.0 44.7 -48.6 34.1 3.3 58.0 43.6 -21.8 -32.9 28.2 33.6 -14.4 -22.0 2.5 5.4 -36.3 -9.5 -2.4 1.0 -4.3 60.4 -37.1 -1.4 -3.5 34.4 -39.5 -11.8

Economic Bulletin

Statistical Appendices

7. Composite indices of business cycle indicators, CSI and BSI Period

Leading index (2015=100)

Cyclical indicator of leading index (2015=100)

Coincident index (2015=100)

Cyclical indicator of coincident index (2015=100)

CSI1

2015 1 2 3 4 5 6 7 8 9 10 11 12 2016 1 2 3 4 5 6 7 8 9p 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7p 8p 9p 10 11

97.8 98.2 98.6 99.0 99.6 99.9 100.2 100.5 101.0 101.5 101.8 101.9 102.0 102.0 102.2 102.6 103.0 103.3 103.7 104.3 104.9 105.4 105.7 106.3 106.8 107.3 107.7 108.2 108.8 109.5 110.0 110.4 110.5 110.8 111.1 111.4 112.0 112.2 112.3 112.3 112.8 113.0 113.3 113.2 113.4 -

100.6 100.6 100.7 100.7 100.9 100.8 100.7 100.6 100.8 100.8 100.7 100.5 100.1 99.7 99.6 99.6 99.6 99.5 99.6 99.8 100.0 100.1 100.1 100.2 100.3 100.4 100.4 100.6 100.8 101.0 101.2 101.1 100.9 100.8 100.7 100.7 100.8 100.6 100.4 100.1 100.1 100.0 99.8 99.4 99.2 -

98.4 99.0 99.1 99.4 99.2 99.3 99.6 100.1 100.9 101.6 101.6 101.9 101.8 101.9 102.0 102.3 102.7 103.2 103.7 104.0 104.0 104.1 104.5 105.0 105.6 105.8 106.3 106.6 106.9 107.0 107.2 107.4 107.7 107.7 108.0 107.9 108.2 108.5 108.8 108.9 109.1 109.2 109.2 109.2 109.2 -

99.9 100.2 100.1 100.1 99.7 99.5 99.5 99.8 100.3 100.7 100.5 100.4 100.1 99.9 99.8 99.7 99.9 100.1 100.3 100.3 100.1 99.9 100.0 100.2 100.5 100.5 100.7 100.7 100.7 100.6 100.5 100.4 100.4 100.2 100.2 99.8 99.8 99.8 99.8 99.7 99.6 99.4 99.1 98.9 98.6 -

102.1 102.8 101.0 103.6 104.9 98.0 99.9 101.2 102.3 104.7 105.4 102.2 99.7 97.5 99.6 101.2 98.8 98.4 100.6 101.5 101.4 101.7 95.3 93.6 92.8 93.9 96.3 100.8 107.7 110.8 110.9 109.6 107.4 108.9 112.0 110.6 109.9 108.2 108.1 107.1 107.9 105.5 101.0 99.2 100.2 99.5 -

1. Consumer Sentiment Index 2. Business Survey Index (manufacturing, seasonally adjusted) p: Preliminary Sources: Statistics Korea, Bank of Korea

BOK BSI2 Results

Prospects

75 75 75 75 69 65 71 70 69 73 69 69 67 64 66 66 68 70 73 73 72 73 73 75 77 77 77 77 78 77 78 81 84 83 84 83 78 77 72 72 74 79 75 75 74 73 -

79 75 79 77 77 74 68 72 71 70 72 72 70 68 64 68 69 72 72 73 74 75 74 75 73 79 79 80 80 81 81 80 82 79 87 85 83 80 79 76 77 76 81 74 76 78 74

November 2018

8. Prices

Period 2015 2016 2017 2015 1 2 3 4 5 6 7 8 9 10 11 12 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8 9 10

All items

y-o-y change (%)

100.0 101.0 102.9 99.8 99.7 99.7 99.8 100.0 100.1 100.2 100.4 100.1 100.1 99.9 100.2 100.4 100.8 100.6 100.8 100.8 100.8 100.6 100.9 101.5 101.6 101.5 101.6 102.4 102.8 102.8 102.7 102.8 102.7 102.9 103.5 103.6 103.4 102.7 103.0 103.5 104.3 104.2 104.3 104.4 104.2 104.4 104.9 105.6 105.4

Source: Bank of Korea

0.7 1.0 1.9 1.0 0.6 0.5 0.4 0.6 0.7 0.7 0.7 0.5 0.8 0.8 1.1 0.6 1.1 0.8 1.0 0.8 0.7 0.4 0.5 1.3 1.5 1.5 1.3 2.0 1.9 2.2 1.9 2.0 1.9 2.2 2.6 2.1 1.8 1.3 1.5 1.0 1.4 1.3 1.6 1.5 1.5 1.5 1.4 1.9 2.0

Consumer prices (2015=100) Commodities Services y-o-y change (%)

100.0 99.4 101.3 100.6 100.4 100.1 99.8 100.3 100.4 100.0 100.1 99.8 99.6 99.3 99.7 99.2 99.9 99.1 99.3 99.1 99.1 98.2 98.5 100.0 100.3 100.1 100.1 101.1 101.6 101.5 100.8 101.0 100.9 100.8 102.0 102.5 101.8 100.6 101.1 101.5 102.7 102.3 102.4 102.5 102.3 102.4 103.4 105.1 104.6

-0.7 -0.6 1.9 0.1 -0.6 -1.0 -1.1 -0.8 -0.4 -0.8 -0.9 -1.3 -0.7 -0.7 -0.2 -1.4 -0.5 -1.0 -0.5 -1.2 -1.3 -1.8 -1.6 0.3 0.8 0.8 0.4 1.9 1.7 2.4 1.6 2.0 1.8 2.7 3.6 2.4 1.5 0.5 1.0 0.5 1.1 0.9 1.6 1.4 1.3 1.6 1.3 2.6 2.8

Core

y-o-y change (%)

100.0 102.3 104.3 99.1 99.2 99.4 99.7 99.8 99.8 100.4 100.6 100.4 100.6 100.5 100.7 101.3 101.6 101.8 101.9 102.2 102.2 102.6 102.8 102.6 102.7 102.6 102.8 103.5 103.7 103.9 104.1 104.2 104.1 104.5 104.7 104.5 104.7 104.4 104.6 105.0 105.5 105.6 105.8 106.0 105.8 106.0 106.2 106.0 106.1

1.8 2.3 2.0 1.7 1.7 1.7 1.6 1.6 1.6 2.0 2.0 1.9 2.1 2.0 2.2 2.3 2.5 2.4 2.3 2.4 2.4 2.1 2.2 2.2 2.1 2.1 2.0 2.2 2.1 2.1 2.2 2.0 1.9 1.9 1.8 1.8 2.0 1.8 1.8 1.4 1.7 1.7 1.6 1.7 1.6 1.4 1.4 1.4 1.3

y-o-y change (%)

100.0 101.6 103.1 99.4 99.5 99.6 99.6 99.9 99.9 100.2 100.3 100.2 100.4 100.4 100.6 101.0 101.2 101.3 101.5 101.7 101.8 101.5 101.6 101.7 102.1 102.0 101.9 102.5 102.7 102.8 102.8 103.1 103.2 103.3 103.4 103.3 103.5 103.2 103.4 103.6 104.0 104.1 104.3 104.5 104.4 104.5 104.3 104.6 104.7

2.2 1.6 1.5 2.6 2.4 2.2 2.1 2.1 2.0 2.1 2.1 2.0 2.2 2.2 2.3 1.6 1.7 1.7 1.9 1.8 1.8 1.3 1.3 1.5 1.8 1.6 1.2 1.5 1.5 1.4 1.3 1.4 1.4 1.8 1.8 1.6 1.3 1.2 1.5 1.1 1.2 1.3 1.4 1.3 1.2 1.1 0.9 1.2 1.1

Producer prices (2010=100) All items Commodities y-o-y change (%)

101.0 99.1 102.5 101.9 101.9 101.8 101.8 101.8 101.8 101.4 100.8 100.3 99.7 99.3 99.0 98.5 98.5 98.4 98.7 98.8 99.0 98.9 99.0 99.2 99.5 100.0 100.9 102.3 102.7 102.7 102.4 102.2 101.8 101.9 102.3 103.0 103.1 103.0 103.1 103.6 104.0 104.0 104.2 100.4 104.5 104.9 105.5 105.8 105.4

-4.0 -1.8 3.5 -3.6 -3.6 -3.7 -3.6 -3.5 -3.6 -4.0 -4.5 -4.6 -4.6 -4.7 -4.0 -3.3 -3.4 -3.3 -3.0 -3.0 -2.7 -2.5 -1.8 -1.1 -0.1 0.7 1.8 3.9 4.3 4.3 3.8 3.4 2.8 3.0 3.3 3.8 3.6 3.1 2.2 1.2 1.3 1.3 1.7 2.2 2.6 3.0 3.1 2.7 2.2

y-o-y change (%)

98.0 94.6 99.0 99.7 99.7 99.5 99.3 99.3 99.3 98.6 97.7 97.0 96.0 95.3 95.0 94.0 93.9 93.8 94.1 94.3 94.6 94.4 94.4 94.7 95.0 95.7 97.0 99.0 99.5 99.3 99.0 98.5 97.8 97.9 98.5 99.5 99.6 99.4 99.5 99.9 100.5 100.5 100.6 100.9 101.1 101.6 102.3 102.8 102.2

-6.4 -3.4 4.6 -5.8 -5.8 -5.9 -5.8 -5.7 -5.8 -6.4 -7.1 -7.3 -7.4 -7.6 -6.6 -5.7 -5.9 -5.7 -5.2 -5.1 -4.7 -4.3 -3.4 -2.4 -1.0 0.4 2.2 5.3 6.0 5.9 5.1 4.4 3.4 3.7 4.4 5.1 4.8 3.9 2.5 0.9 1.0 1.1 1.6 2.5 3.2 3.8 3.8 3.3 2.6

Economic Bulletin

Statistical Appendices

9. Employment (I) Period 2016 2017 2016 2017 2018

Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ II III 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8 9 10

Economically active persons (thousands)

y-o-y change

Economically inactive persons (thousands)

y-o-y change

27,418 27,748 26,896 27,578 27,702 27,497 27,262 27,993 27,961 27,775 27,464 28,125 28,080 26,631 26,925 27,133 27,398 27,617 27,720 27,737 27,690 27,679 27,666 27,613 27,211 26,886 27,321 27,579 27,911 27,987 28,081 28,037 27,903 27,943 27,920 27,889 27,516 27,232 27,348 27,811 28,029 28,184 28,161 28,123 28,039 28,079 28,063

265 329 266 197 308 289 366 414 259 278 202 132 120 251 254 293 195 164 233 202 396 325 307 315 246 255 396 446 513 370 360 299 214 263 254 276 305 346 27 232 117 198 80 86 136 137 143

16,187 16,183 16,576 15,991 15,950 16,233 16,556 15,906 16,006 16,263 16,624 16,017 16,131 16,808 16,546 16,373 16,138 15,955 15,880 15,889 15,962 15,998 16,038 16,117 16,544 16,904 16,497 16,267 15,960 15,916 15,844 15,909 16,064 16,044 16,095 16,151 16,543 16,840 16,744 16,289 16,093 15,956 16,000 16,064 16,172 16,158 16,199

102 -5 127 178 48 53 -20 -85 56 30 68 110 126 148 136 96 186 213 136 159 -40 25 40 29 91 96 -49 -107 -179 -39 -36 20 102 45 57 34 -1 -64 247 22 134 41 156 155 108 114 105

Source: Statistics Korea

Labor force rate participation rate Employment (%) (%) 62.9 63.2 61.9 63.3 63.5 62.9 62.2 63.8 63.6 63.1 62.3 63.7 63.5 61.3 61.9 62.4 62.9 63.4 63.6 63.6 63.4 63.4 63.3 63.1 62.2 61.4 62.4 62.9 63.6 63.7 63.9 63.8 63.5 63.5 63.4 63.3 62.5 61.8 62.0 63.1 63.5 63.9 63.8 63.6 63.4 63.5 63.4

60.6 60.8 59.2 60.9 61.2 60.9 59.6 61.3 61.4 61.0 59.6 61.2 61.1 59.0 58.9 59.7 60.5 61.1 61.3 61.3 61.2 61.1 61.2 61.2 60.2 59.1 59.3 60.3 61.0 61.5 61.5 61.6 61.2 61.4 61.4 61.4 60.4 59.5 59.2 60.2 60.9 61.3 61.4 61.3 60.9 61.2 61.2

Unemployment rate (%) 3.7 3.7 4.3 3.7 3.5 3.2 4.3 3.8 3.4 3.2 4.3 3.9 3.8 3.7 4.9 4.2 3.9 3.6 3.6 3.5 3.6 3.5 3.3 3.1 3.2 3.7 4.9 4.1 4.2 3.6 3.8 3.4 3.6 3.3 3.2 3.1 3.3 3.7 4.6 4.5 4.1 4.0 3.7 3.7 4.0 3.6 3.5

November 2018

10. Employment (II) Period 2016 2017 2016 2017 2018

Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8 9 10

Employed persons (thousands) All industry

y-o-y change

Manufacturing

y-o-y change

SOC & services

y-o-y change

26,409 26,725 25,747 26,552 26,719 26,618 26,100 26,919 26,998 26,883 26,283 27,019 27,015 25,646 25,615 25,980 26,325 26,613 26,718 26,765 26,696 26,697 26,746 26,762 26,347 25,878 25,979 26,443 26,744 26,992 27,020 27,078 26,904 27,011 27,026 27,019 26,604 26,213 26,083 26,555 26,868 27,064 27,126 27,083 26,907 27,055 27,090

231 316 204 211 255 256 353 367 279 265 183 101 17 254 145 214 172 182 278 227 327 209 227 293 249 232 364 463 420 379 302 314 208 314 281 257 257 334 104 112 123 72 106 5 3 45 64

4,584 4,566 4,650 4,599 4,540 4,545 4,530 4,579 4,570 4,586 4,575 4,487 4,479 4,673 4,648 4,630 4,601 4,608 4,588 4,564 4,519 4,538 4,547 4,549 4,541 4,503 4,549 4,539 4,542 4,586 4,608 4,611 4,544 4,555 4,560 4,581 4,618 4,609 4,562 4,554 4,473 4,507 4,482 4,484 4,439 4,513 4,515

-21 -18 113 15 -92 -119 -120 -21 30 41 45 -91 -91 127 99 111 23 28 -6 -85 -97 -94 -125 -112 -120 -170 -99 -91 -60 -22 20 47 25 17 14 32 77 106 14 15 -68 -79 -126 -127 -105 -42 -45

20,534 20,857 20,051 20,530 20,763 20,792 20,546 20,913 20,986 20,986 20,630 21,053 21,039 20,056 19,984 20,113 20,350 20,566 20,674 20,797 20,759 20,733 20,759 20,841 20,775 20,462 20,453 20,721 20,842 20,963 20,933 21,037 20,922 20,999 21,008 21,061 20,888 20,596 20,503 20,792 20,979 21,054 21,127 21,114 20,967 21,036 21,068

312 323 144 283 429 390 494 383 223 194 85 141 53 199 104 129 210 255 385 425 493 370 399 377 393 406 469 608 492 396 260 240 162 266 249 220 113 134 49 71 137 92 194 77 45 37 60

Source: Statistics Korea

Economic Bulletin

Statistical Appendices

11. Balance of payments (I) (US $ million)

Period 2016 2017p 2016 Ⅰ Ⅱ Ⅲ Ⅳ 2017p Ⅰ Ⅱ Ⅲ Ⅳ 2018p Ⅰ II Ⅲ 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017p 1 2 3 4 5 6 7 8 9 10 11 12 2018p 1 2 3 4 5 6 7 8 9 p: Preliminary Source: Bank of Korea

Current account

Goods

99,243.0 78,460.2 26,961.1 27,040.2 22,563.8 22,677.9 19,203.3 16,451.5 25,570.0 17,235.4 11,825.3 17,825.8 28,029.0 7,619.3 7,983.6 11,358.2 4,262.0 10,516.0 12,262.2 8,829.3 5,666.0 8,068.5 7,694.9 8,028.0 6,955.0 5,299.8 8,181.8 5,721.7 3,670.0 5,841.7 6,939.8 7,249.7 6,032.8 12,287.5 5,715.5 7,427.6 4,092.3 2,680.4 3,964.5 5,180.4 1,768.2 8,680.6 7,377.0 8,757.8 8,439.8 10,831.4

118,895.4 119,888.7 30,209.1 33,174.8 28,184.0 27,327.5 27,307.0 29,561.1 34,750.3 28,270.3 23,912.4 31,799.4 35,908.8 8,432.7 8,256.2 13,520.2 10,108.6 10,466.1 12,600.1 10,650.0 7,058.6 10,475.4 9,164.6 9,690.2 8,472.7 7,731.1 10,220.2 9,355.7 11,542.1 8,595.9 9,423.1 10,587.4 9,184.3 14,978.6 8,597.4 11,461.0 8,211.9 8,108.8 5,927.9 9,875.7 10,357.5 11,386.0 10,035.9 11,427.9 11,236.6 13,244.3

Exports

Imports

511,947.3 577,381.4 118,983.8 127,574.7 128,614.1 136,774.7 139,316.9 143,112.7 148,862.8 146,089.0 149,738.8 157,542.6 158,408.5 37,290.7 36,511.5 45,181.6 40,463.3 42,129.5 44,981.9 42,583.8 41,815.7 44,214.6 43,086.8 46,258.7 47,429.2 44,531.6 44,626.2 50,159.1 48,134.6 46,956.0 48,022.1 47,101.1 47,687.2 54,074.5 44,429.8 51,480.4 50,178.8 52,069.7 44,893.5 52,775.6 51,507.9 53,778.7 52,256.0 54,062.6 53,268.3 51,077.6

393,051.9 457,492.7 88,774.7 94,399.9 100,430.1 109,447.2 112,009.9 113,551.6 114,112.5 117,818.7 125,826.4 125,763.2 122,499.7 28,858.0 28,255.3 31,661.4 30,354.7 31,663.4 32,381.8 31,933.8 34,757.1 33,739.2 33,922.2 36,568.5 38,956.5 36,800.5 34,406.0 40,803.4 36,592.5 38,360.1 38,599.0 36,513.7 38,502.9 39,095.9 35,832.4 40,019.4 41,966.9 43,960.9 38,956.6 42,899.9 41,150.4 42,392.7 42,220.1 42,634.7 42,031.7 37,833.3

Services

Primary income

Secondary income

-17,737.4 -34,472.2 -3,658.5 -4,204.5 -5,549.4 -4,325.0 -8,662.7 -6,748.6 -8,497.5 -10,563.4 -9,409.9 -6,525.7 -7,745.3 -1,619.8 -1,164.6 -874.1 -1,730.5 -1,161.3 -1,312.7 -1,461.2 -1,475.8 -2,612.4 -1,785.6 -1,813.9 -725.5 -3,340.7 -2,210.3 -3,111.7 -2,417.2 -1,638.7 -2,692.7 -3,285.3 -2,334.6 -2,877.6 -3,531.3 -3,266.1 -3,766.0 -4,494.1 -2,663.9 -2,251.9 -1,982.6 -2,093.9 -2,449.2 -3,116.1 -2,113.4 -2,515.8

3,851.7 122.0 1,381.7 -717.5 2,324.6 862.9 1,374.8 -4,876.8 1,946.9 1,677.1 385.4 -5,168.6 1,935.7 1,264.2 871.4 -753.9 -3,593.3 1,358.1 1,517.7 266.1 1,034.0 1,024.5 707.1 366.3 -210.5 1,176.5 718.9 -520.6 -4,924.3 -595.7 643.2 676.0 22.6 1,248.3 1,168.1 -72.2 581.2 678.5 1,281.9 -1,575.0 -5,857.9 228.8 460.5 1,217.3 51.1 667.3

-5,766.7 -7,078.3 -971.2 -1,212.6 -2,395.4 -1,187.5 -815.8 -1,484.2 -2,629.7 -2,148.6 -3,062.6 -2,259.3 -2,070.2 -457.8 20.6 -534.0 -522.8 -146.9 -542.9 -625.6 -950.8 -819.0 -391.2 -214.6 -581.7 -267.1 -547.0 -1.7 -530.6 -519.8 -433.8 -728.4 -839.5 -1,061.8 -518.7 -695.1 -934.8 -1,612.8 -581.4 -868.4 -748.8 -840.3 -670.2 -771.3 -734.5 -564.4

November 2018

12. Balance of payments (II) (US $ million)

Period 2016 2017p 2016 Ⅰ Ⅱ Ⅲ Ⅳ 2017p Ⅰ Ⅱ Ⅲ Ⅳ 2018p Ⅰ II Ⅲ 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017p 1 2 3 4 5 6 7 8 9 10 11 12 2018p 1 2 3 4 5 6 7 8 9

Financial account*

Direct investment

Portfolio investment

Financial derivatives

Other investment

Reserve assets

102,566.8 87,100.4 29,486.0 23,327.5 24,822.1 24,931.2 19,741.1 13,043.4 30,844.5 23,471.4 12,545.0 11,394.2 27,462.0 7,326.7 9,715.9 12,443.4 1,814.8 9,908.3 11,604.4 8,811.4 6,960.3 9,050.4 8,359.1 8,505.8 8,066.3 5,067.0 8,880.5 5,793.6 1,471.6 2,642.6 8,929.2 9,442.0 8,990.9 12,411.6 8,436.4 10,438.0 6,347.0 4,112.7 4,213.1 4,219.2 14.1 6,751.9 4,628.2 10,456.2 7,276.8 9,729.0

17,856.7 14,623.0 5,704.8 4,507.8 1,847.5 5,796.6 6,881.2 3,476.4 4,428.9 -163.5 1,984.8 8,149.9 8,805.6 208.1 2,187.2 3,309.5 814.0 1,450.2 2,243.6 719.7 -291.7 1,419.5 1,144.8 62.6 4,589.2 3,270.3 4,344.1 -733.2 1,500.3 685.3 1,290.8 460.0 1,622.4 2,346.5 72.6 -70.6 -165.5 138.6 325.3 1,520.9 1,883.5 6,056.9 209.5 2,258.4 4,376.4 2,170.8

66,970.2 57,847.4 16,794.1 13,981.8 15,865.5 20,328.8 8,011.4 11,516.2 23,972.0 14,347.8 12,858.3 4,219.5 7,410.9 5,412.9 5,749.6 5,631.6 3,277.6 4,546.1 6,158.1 145.0 7,111.8 8,608.7 9,921.6 7,011.4 3,395.8 4,917.9 809.9 2,283.6 2,810.3 5,660.3 3,045.6 2,693.6 11,330.5 9,947.9 -173.2 2,101.7 12,419.3 3,490.7 9,168.4 199.2 3,938.2 407.4 -126.1 -3,207.8 1,492.1 9,126.6

-3,440.1 -8,253.3 2,724.0 -1,185.3 -3,799.5 -1,179.3 -2,951.0 -2,066.8 -350.9 -2,884.6 -3,607.1 -1,406.2 2,296.0 1,227.8 756.6 739.6 -1,043.5 -463.7 321.9 -471.9 -1,292.4 -2,035.2 -739.5 83.0 -522.8 -146.9 -1,593.2 -1,210.9 -912.4 -413.3 -741.1 -79.2 -161.3 -110.4 -555.6 -877.1 -1,451.9 -1,285.9 -857.4 -1,463.8 -748.1 -484.1 -174.0 1,091.4 761.9 442.7

13,564.8 18,523.3 5,596.8 5,103.8 3,949.4 -1,085.2 7,063.2 -96.6 2,945.8 8,610.9 -1,478.8 -9,371.5 6,803.2 117.7 2,613.5 2,865.6 -2,549.9 3,974.0 3,679.7 6,451.8 -1,656.4 -846.0 -2,188.1 1,865.9 -763.0 -3,232.5 5,471.3 4,824.4 -1,755.7 -3,368.2 5,027.3 6,238.7 -4,147.6 854.7 7,665.6 7,914.5 -5,219.2 329.0 -4,582.9 2,775.1 -8,178.5 -2,936.2 1,743.2 8,829.1 1,882.0 -3,907.9

7,615.2 4,360.0 -1,333.7 919.4 6,959.2 1,070.3 736.3 214.2 -151.3 3,560.8 2,787.8 9,802.5 2,146.3 360.2 -1,591.0 -102.9 1,316.6 401.7 -798.9 1,966.8 3,089.0 1,903.4 220.3 -517.1 1,367.1 258.2 -151.6 629.7 -170.9 78.5 306.6 128.9 346.9 -627.1 1,427.0 1,369.5 764.3 1,440.3 159.7 1,187.8 3,119.0 3,707.9 2,975.6 1,485.1 -1,235.6 1,896.8

* Positive figures represent net outflows, and negative figures represent net inflows. p: Preliminary Source: Bank of Korea

Capital account -46.2 -31.3 -8.1 -7.0 13.9 -45.0 36.4 -60.3 -7.7 0.3 -21.3 -70.7 61.5 -2.6 -2.3 -3.2 -5.0 1.0 -3.0 5.8 17.2 -9.1 -6.3 -35.0 -3.7 40.1 -2.0 -1.7 -26.2 -2.0 -32.1 15.3 -21.8 -1.2 -7.4 38.8 -31.1 -6.5 -13.4 -1.4 -64.9 2.6 -8.4 -6.7 -5.1 73.3

Economic Bulletin

Statistical Appendices

13. Financial indicators (period average)

Yields (%) Period 2015 1 2 3 4 5 6 7 8 9 10 11 12 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8 9 10 Source: Bank of Korea

Call rate (1 day)

CDs (91 days)

Treasury bonds (3 years)

2.0 2.0 1.8 1.7 1.7 1.6 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.3 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.3 1.2 1.3 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5

2.1 2.1 2.0 1.8 1.8 1.7 1.7 1.6 1.6 1.6 1.6 1.7 1.7 1.6 1.6 1.6 1.6 1.4 1.4 1.4 1.3 1.4 1.4 1.5 1.5 1.5 1.5 1.4 1.4 1.4 1.4 1.4 1.4 1.4 1.5 1.7 1.7 1.7 1.7 1.7 1.7 1.7 1.7 1.7 1.7 1.7

2.0 2.0 1.9 1.7 1.9 1.8 1.8 1.7 1.7 1.6 1.8 1.7 1.6 1.5 1.5 1.5 1.5 1.3 1.2 1.2 1.3 1.4 1.6 1.7 1.6 1.7 1.7 1.7 1.7 1.7 1.7 1.8 1.8 2.0 2.2 2.1 2.2 2.3 2.3 2.2 2.3 2.2 2.1 2.0 2.0 2.0

Stock Treasury bonds (5 years)

Corporate bonds (3 years, AA-)

KOSPI (end-period)

2.2 2.1 2.0 1.9 2.1 2.0 2.1 2.0 1.8 1.8 1.9 1.9 1.8 1.6 1.6 1.6 1.6 1.4 1.3 1.3 1.4 1.4 1.7 1.9 1.8 1.9 1.9 1.9 1.9 1.9 1.9 2.0 2.0 2.2 2.4 2.3 2.4 2.5 2.5 2.4 2.5 2.4 2.3 2.2 2.1 2.2

2.4 2.3 2.1 2.0 2.1 2.0 2.0 2.0 2.0 2.0 2.1 2.1 2.1 2.0 2.0 1.9 1.9 1.8 1.7 1.7 1.7 1.8 2.0 2.2 2.1 2.1 2.2 2.2 2.2 2.2 2.3 2.3 2.3 2.6 2.7 2.6 2.7 2.8 2.8 2.8 2.9 2.8 2.8 2.7 2.4 2.5

1,949.26 1,985.80 2,041.03 2,127.17 2,114.80 2,074.20 2,030.16 1,941.49 1,962.81 2,029.47 1,991.97 1,961.31 1,912.06 1,916.66 1,995.85 1,994.15 1,983.40 1,970.35 2,016.19 2,034.65 2,043.63 2,008.19 1,983.48 2,026.46 2,067.57 2,091.64 2,160.23 2,205.44 2,347.38 2,391.79 2,402.71 2,363.19 2,394.47 2,523.43 2,476.37 2,467.49 2,566.46 2,427.36 2,445.85 2,515.38 2,423.01 2,326.13 2,295.26 2,322.88 2,343.07 2,029.69

November 2018

14. Monetary indicators (period average, billion won)

Reserves Period 2015 2016 2017 2015 1 2 3 4 5 6 7 8 9 10 11 12 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8 9

y-o-y change (%)

120,691.4 137,441.5 151,858.1 113,304.2 116,502.4 115,974.9 115,132.7 117,726.3 118,688.2 122,041.0 121,854.4 126,572.2 125,616.2 126,767.1 128,117.5 131,279.3 134,913.0 132,957.9 135,038.9 135,971.3 135,758.4 135,906.7 139,073.9 142,079.6 141,103.5 141,757.2 143,458.7 147,380.8 150,092.9 145,049.0 149,630.1 149,446.2 150,519.7 149,955.1 152,170.5 154,578.6 159,248.2 155,623.3 158,603.1 157,220.1 163,852.7 160,760.7 161,527.1 160,475.5 164,397.3 163,223.4 165,629.2 170,529.6

Source: Bank of Korea

16.8 13.9 10.5 15.0 15.9 15.3 16.4 15.7 17.0 20.6 13.2 20.1 17.3 18.8 16.3 15.9 15.8 14.6 17.3 15.5 14.4 11.4 14.1 12.3 12.3 11.8 12.0 12.3 11.3 9.1 10.8 9.9 10.9 10.3 9.4 8.8 12.9 9.8 10.6 6.7 9.2 10.8 8.0 7.4 9.2 8.8 8.8 10.3

M2 y-o-y change (%)

636,639.0 734,411.8 802,016.5 579,964.2 592,737.4 600,719.9 610,803.3 621,985.5 630,546.3 645,975.4 653,105.9 665,691.1 669,737.7 677,629.2 690,772.4 699,767.3 708,014.0 713,861.2 720,818.5 722,544.4 730,637.8 735,172.2 738,120.9 751,408.5 753,367.3 762,639.7 776,589.6 780,995.5 776,362.5 789,187.8 791,859.3 791,074.8 798,890.2 804,853.4 805,103.3 810,905.0 826,892.1 817,624.5 830,003.7 830,732.8 839,555.2 840,991.0 841,002.2 839,880.5 846,240.2 843,752.8 837,607.5 845,523.7

18.6 15.4 9.2 12.5 14.3 15.5 17.7 18.9 18.5 21.0 21.3 21.4 21.5 20.6 19.6 20.7 19.4 18.8 18.0 16.2 15.9 13.8 13.0 12.9 12.5 12.5 12.4 11.6 9.7 10.6 9.9 9.5 9.3 9.5 9.1 7.9 9.8 7.2 6.9 6.3 8.1 6.6 6.2 6.2 5.9 4.8 4.0 4.3

Lf y-o-y change (%)

2,182,911.9 2,342,621.3 2,471,225.6 2,092,223.5 2,109,892.3 2,127,887.8 2,148,114.7 2,166,741.1 2,179,561.1 2,200,510.9 2,218,660.3 2,230,000.7 2,232,432.0 2,242,848.2 2,246,070.1 2,261,356.4 2,285,313.5 2,294,544.7 2,299,081.3 2,312,801.2 2,334,256.2 2,352,245.1 2,377,323.1 2,383,040.5 2,391,059.2 2,406,393.5 2,414,040.9 2,417,635.8 2,420,285.6 2,436,994.7 2,450,220.9 2,454,386.7 2,470,861.1 2,472,110.4 2,485,629.9 2,492,388.4 2,504,594.2 2,521,786.3 2,527,641.3 2,551,196.0 2,570,764.6 2,578,361.8 2,590,840.7 2,600,274.3 2,622,268.3 2,637,421.8 2,651,503.4 2,652,829.5

8.6 7.3 5.5 8.0 8.0 8.3 9.0 9.3 9.0 9.3 9.2 9.4 8.8 7.7 7.5 8.1 8.3 7.8 7.0 6.7 7.1 6.9 7.2 6.9 7.1 7.3 7.5 6.9 5.9 6.2 6.6 6.1 5.9 5.1 4.6 4.6 4.7 4.8 4.7 5.5 6.2 5.8 5.7 5.9 6.1 6.7 6.7 6.4

y-o-y change (%)

2,986,699.4 3,229,766.4 3,445,645.8 2,857,610.1 2,876,467.8 2,907,976.4 2,936,746.7 2,960,998.1 2,986,316.5 3,013,503.9 3,028,981.1 3,049,823.2 3,059,051.9 3,076,029.2 3,086,887.8 3,110,535.8 3,133,492.2 3,158,687.8 3,170,277.9 3,189,899.3 3,223,154.5 3,242,338.3 3,270,365.6 3,288,026.0 3,305,950.4 3,328,489.7 3,337,069.4 3,359,110.8 3,365,200.1 3,387,986.2 3,404,957.2 3,416,320.2 3,440,571.4 3,454,563.6 3,472,041.5 3,483,119.8 3,501,084.6 3,521,139.1 3,541,553.2 3,573,130.0 3,596,261.3 3,614,934.9 3,628,930.4 3,643,255.3 3,671,929.8 3,698,202.0 3,718,480.4 3,734,526.2

9.7 8.1 6.7 8.4 8.6 9.3 10.0 10.3 10.5 10.6 10.4 10.5 10.2 9.2 8.9 8.9 8.9 8.6 8.0 7.7 7.9 7.6 8.0 7.8 8.1 8.2 8.1 8.0 7.4 7.3 7.4 7.1 6.7 6.5 6.2 5.9 5.9 5.8 6.1 6.4 6.8 6.7 6.6 6.6 6.7 7.1 7.1 7.2

Economic Bulletin

Statistical Appendices

15. Exchange rates (end-period)

US $/\ Period 2015 2016 2017 2015 1 2 3 4 5 6 7 8 9 10 11 12 2016 1 2 3 4 5 6 7 8 9 10 11 12 2017 1 2 3 4 5 6 7 8 9 10 11 12 2018 1 2 3 4 5 6 7 8 9 10 Source: Bank of Korea

100ďżĽ/\

Won

y-o-y change (%)

1,172.0 1,208.5 1,071.4 1,190.8 1,099.2 1,105.0 1,068.1 1,108.0 1,124.1 1,166.3 1,176.3 1,194.5 1,142.3 1,150.4 1,172.0 1,208.4 1,235.4 1,153.5 1,143.9 1,190.6 1,164.7 1,125.7 1,118.5 1,096.3 1,145.2 1,168.5 1,208.5 1,157.8 1,132.1 1,116.1 1,130.1 1,123.9 1,139.6 1,119.1 1,122.8 1,146.7 1,125.0 1,082.4 1,071.4 1,071.5 1,071.0 1,066.5 1,076.2 1,081.3 1,121.7 1,116.7 1,108.8 1,112.7 1,140.6

6.6 3.1 -11.3 1.1 3.0 3.4 3.5 8.5 10.8 13.9 16.1 13.7 8.4 4.5 6.6 10.8 12.4 4.4 7.1 7.5 3.6 -3.5 -4.9 -8.2 0.3 1.6 3.1 -4.2 -8.4 -3.2 -1.2 -5.6 -2.2 -0.6 0.4 4.6 -1.8 -7.4 -11.3 -7.5 -5.4 -4.4 -4.8 -3.8 -1.6 -0.2 -1.2 -3.0 1.4

Euro/\

Won

y-o-y change (%)

Won

y-o-y change (%)

972.0 1,036.8 949.1 921.4 920.7 920.3 897.2 894.6 917.2 939.3 970.1 996.8 994.1 936.7 972.0 1,017.1 1,083.8 1,026.0 1,058.2 1,072.8 1,132.2 1,073.7 1,086.3 1,083.7 1,094.4 1,038.8 1,036.8 1,017.9 1,004.0 998.5 1,016.0 1,014.3 1,017.6 1,012.3 1,017.4 1,020.4 994.2 966.5 949.1 985.0 997.3 1,001.5 985.9 994.0 1,014.8 1,006.0 998.7 981.2 1,008.9

5.6 6.7 -8.5 -11.7 -11.9 -11.4 -10.8 -10.9 -8.3 -5.7 -0.8 3.8 -2.1 0.3 5.6 10.4 17.9 11.5 17.9 19.9 23.4 14.3 12.0 8.7 15.9 10.9 6.7 0.1 -7.5 -2.7 -4.0 -5.4 -10.1 -5.7 -6.3 -5.8 -9.2 -7.0 -8.5 -3.2 -0.7 0.3 -3.0 -2.0 -0.3 -0.6 -1.8 -3.8 1.5

1,280.5 1,267.6 1,279.3 1,235.7 1,230.7 1,196.8 1,187.0 1,215.2 1,260.5 1,275.4 1,317.3 1,343.9 1,254.8 1,218.3 1,280.5 1,322.2 1,348.3 1,307.4 1,298.4 1,326.8 1,295.5 1,246.7 1,246.9 1,230.3 1,257.1 1,244.3 1,267.6 1,239.5 1,198.6 1,192.6 1,228.1 1,255.6 1,304.0 1,315.7 1,335.6 1,350.9 1,310.1 1,282.7 1,279.3 1,329.1 1,310.4 1,312.0 1,304.5 1,261.3 1,297.0 1,307.4 1,293.2 1,294.6 1,294.0

-4.2 -1.0 0.9 -16.1 -15.9 -18.6 -16.7 -12.6 -8.9 -7.0 -1.4 0.8 -5.6 -11.2 -4.2 7.0 9.6 9.2 9.4 9.2 2.8 -2.3 -5.3 -8.5 0.2 2.1 -1.0 -6.3 -11.1 -8.8 -5.4 -5.4 0.7 5.5 7.1 9.8 4.2 3.1 0.9 7.2 9.3 10.0 6.2 0.5 -0.5 -0.6 -3.2 -4.2 -1.2

Useful websites

Ministry of Economy and Finance

http://english.moef.go.kr Korea Development Institute

http://www.kdi.re.kr/kdi_eng Ministry of Trade, Industry and Energy

http://english.motie.go.kr Financial Services Commission

http://www.fsc.go.kr/eng Financial Supervisory Service

http://english.fss.or.kr Fair Trade Commission

http://www.ftc.go.kr/eng Ministry of Employment and Labor

http://www.moel.go.kr/english Bank of Korea

http://www.bok.or.kr/eng Statistics Korea

http://kostat.go.kr/portal/eng

November 2018

ECONOMIC BULLETIN (Republic of Korea)

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