Economic Bulletin_201812_english by KOCIS

Republic of Korea

Economic Bulletin

Vol.40 No.12 December 2018 eb.kdi.re.kr ISSN 2287-7266

The Green Book: Current Economic Trends Policy Issue 2019 Economic Policies

Economic News Briefing BOK Lifts Interest Rate to 1.75% Korea Issues This Year's Fourth 50-yr KTBs Korean FDI Posts US $13.11 Billion in Q3 2018 Korea Grows 0.6% in Q3 2018

Statistical Appendices

Bokjumeoni A colorful pouch made of fabric decorated with patches or embroidery on it is called a Bokjumeoni , a pouch that brings blessings. The blessing pouch used to be a popular new yearâ&#x20AC;&#x2122;s gift, and was believed that if a person carries it with him, it would drive away evil.

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

Policy Issue 2019 economic policies

Economic News Briefing BOK lifts interest rate to 1.75% Korea issues this yearâ&#x20AC;&#x2122;s fourth 50-yr KTBs Korean FDI posts US $13.11 billion in Q3 2018 Korea grows 0.6% in Q3 2018 (preliminary)

53 Statistical Appendices

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) Editors Shin Dong-Gyun (MOEF) Lee Hyun-Jin (KDI)

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

December 2018

Overview

The Korean economy has seen exports and consumption improve. However, investment and employment have yet to pick up, and external uncertainties linger amid ongoing trade conflicts between the US and China. Industrial activities improved in October, and employment growth exceeded 100,000 in November for the first time in five months. The economy added 165,000 jobs year-on-year in November led by the construction and service sectors. Manufacturing jobs fell. Young adult unemployment declined (9.2% → 7.9%, down 1.3%p, y-o-y). Consumer prices were stable in November (up 2.0% → up 2.0%, y-o-y, compared with a month ago): Oil product prices became stable, as well as agricultural product prices, and the natural gas rate cut given a year ago began to have no more effect on the index. All industry production improved in October (down 1.2% → up 0.4%, m-o-m): Mining and manufacturing production rose (down 2.7% → up 1.0%, m-o-m) due to strong processed metals and other transportation equipment. Service output continued to increase (up 0.1% → up 0.3%, m-o-m), despite a drop in welfare services, as financial & insurance services rose. Retail sales increased in October (down 2.1% → up 0.2%, m-o-m): Sales of durable goods rose 1.7 percent and semi-durable goods 0.4 percent, while sales of nondurable goods fell 0.6 percent. Facility investment continued to increase in October (up 3.3% → up 1.9%, m-o-m) as transportation equipment improved. Construction completed fell (down 3.5% → down 2.2%, m-o-m) as both building construction and civil engineering works declined. In October, the cyclical indicator of the coincident composite index fell 0.2 points to 98.4, and the cyclical indicator of the leading composite index fell 0.4 points to 98.8. Exports in November amounted to US $51.92 billion, posting the third largest on record, backed by strong vessels, petroleum products, semiconductors and petrochemicals, as well as due to more days worked. The January-November exports for 2018 posted the largest on record. In November KOSPI rose after the US mid-term elections as political uncertainties removed. The dollar-won exchange rate fell on expectations that Fed might slow down its rate hike. Government bond yields fell. Housing prices rose in November (up 0.19% → up 0.13%, m-o-m) due to price hikes in both the Seoul metropolitan area and other areas. Jeonse (lump-sum deposits with no monthly payments) prices continued to fall (down 0.05% → down 0.09%, m-o-m) as prices declined in both the Seoul metropolitan area and other areas.

Economic Bulletin

The Green Book

The economy is expected to continue to recover given improving global economies and strong exports, but job markets are weak and there are external risks, such as US-China trade conflicts, Fed’s rate hikes and increasing financial market volatility. The government will strengthen its risk management and work to boost the economy by implementing measures to achieve industrial innovation, create jobs and support low-income households and small merchants. The government will work to fast implement the 2019 economic policies, which have drawn to help achieve an inclusive and dynamic economy.

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 has continued to recover as industrial production improved, as well as retail sales amid increasing demand due to Thanksgiving holiday and Black Friday. Industrial production rose 0.6 percent month-on-month in November due to the strong production of mining (up 1.7%, m-o-m) and public utilities (up 3.3%, m-o-m). The ISM Manufacturing Index rose in the month. ISM Manufacturing Index (base=50)

60.2 (Jun 2018) → 58.1 (Jul) → 61.3 (Aug) → 59.8 (Sep) → 57.7 (Oct) → 59.3 (Nov)

Retail sales rose 0.2 percent month-on-month in November as automobile sales continued to improve (up 0.2%, m-o-m), as well as nonstore retailer sales (up 2.3%, m-o-m). Consumer confidence dropped. Conference Board Consumer Confidence Index (1985=100)

127.1 (Jun 2018) → 127.9 (Jul) → 134.7 (Aug) → 135.3 (Sep) → 137.9 (Oct) → 135.7 (Nov)

Existing home sales increased 1.4 percent month-on-month in October to an annual rate of 5,220,000 homes (down 5.1%, y-o-y). New home sales fell 8.9 percent month-on-month to an annual rate of 540,000 units (down 12.0%, y-o-y). Case-Shiller Home Price Index (y-o-y, %)

6.7 (Apr 2018) → 6.5 (May) → 6.4 (Jun) → 5.9 (Jul) → 5.5 (Aug) → 5.2 (Sep)

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

-5.8 (Apr 2018) → 3.2 (May) → -6.3 (Jun) → -1.0 (Jul) → -2.5 (Aug) → 1.0 (Sep) → -8.9 (Oct)

December 2018

Nonfarm payrolls rose by 155,000 in November, the unemployment rate holding at 3.7 percent, the lowest since December 1969. The employment rate was 60.6 percent, staying unchanged from the previous month. Labor force participation rate (%)

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

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

208 (Jun 2018) → 165 (Jul) → 286 (Aug) → 119 (Sep) → 237 (Oct) → 155 (Nov)

Unemployment rate (%)

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

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) Unemployment rate (right)

-1,000

0 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Source: US Department of Commerce, Federal Reserve Board

(Percentage change from previous period)

2016

2017

Annual Annual Q1

Real GDP

2018

Q3 Sep Oct Nov

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

1.2

0.1 -0.2 0.6

Retail sales

2.9

4.7

1.5

0.6

2.3

0.4

1.8

1.1 -0.2

Existing home sales

4.1

1.7

1.0 -1.0 -2.6

3.5 -1.5 -1.7 -2.6 -3.4

1.4

Unemployment rate2

4.9

4.4

4.7

4.3

4.1

3.9

3.8

3.7

Consumer prices (y-o-y)

1.3

2.1

2.6

1.9

2.0

2.1

2.3

2.6

2.3

2.5 2.2

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

1.0

1.1 0.2

Economic Bulletin

The Green Book

China Chinaâ&#x20AC;&#x2122;s industrial production, retail sales and exports grew at a slower pace in November. Fixed asset investment improved.

Chinaâ&#x20AC;&#x2122;s GDP growth and fixed asset investment (%)

(%)

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

0 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

Sep Oct Nov

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

5.8

5.9

5.7

Fixed asset investment (accumulated, nominal)

8.1

7.2

9.2

8.6

7.5

7.2

7.5

6.0

5.4

5.7

5.9

Retail sales (nominal)

10.4

10.2 10.2 10.8 10.3

9.9

9.7

9.0

9.2

8.6

8.1

Exports

-6.6

6.5

3.2

6.6

6.1

9.4 13.7 11.5 11.8 14.4 15.5

5.4

Consumer prices

2.0

1.6

1.4

1.6

1.8

2.2

1.8

2.3

2.5

2.2

Producer prices1

-1.3

6.3

7.4

5.8

6.2

5.9

3.7

4.1

3.6

3.3

2.7

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

December 2018

Japan Japan’s economy rebounded in October as industrial production and exports picked up, and retail sales continued to improve. Unemployment rate (%)

2.8 (Oct 2017) → 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) → 2.4 (Oct)

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

-5

-25 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

Aug Sep

Oct

Real GDP

1.0

1.7

0.7

0.5

0.6

0.2 -0.2

0.7 -0.6

Industrial production

-0.2

4.5

0.2

1.8

0.4

1.6 -1.3

1.3 -1.7

0.3 -0.4

2.9

Retail sales (nominal)

-0.6

1.9 -0.2

0.6

0.1

1.3 -0.6

0.4

1.1

0.9

0.1

1.3

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

6.6 -1.3

8.2

0.3

1.3

0.7

1.1

1.3

1.4

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 Eurozone’s industrial production and retail sales picked up in October, and the job market stayed stable after unemployment in August hit the lowest since December 2008. Unemployment rate (%)

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

Manufacturing PMI

58.6 (Feb 2018) → 56.6 (Mar) → 56.2 (Apr) → 55.5 (May) → 54.9 (Jun) → 54.1 (Jul) → 54.6 (Aug) → 53.2 (Sep) → 52.0 (Oct) → 51.8 (Nov) → 51.4 (Dec)

Eurozone Economic Sentiment Indicator (base 2010=100)

114.1 (Feb 2018) → 112.7 (Mar) → 112.7 (Apr) → 112.5 (May) → 112.3 (Jun) → 112.1 (Jul) → 111.6 (Aug) → 110.9 (Sep) → 109.7 (Oct) → 109.5 (Nov)

Eurozone’s GDP growth and industrial production (%)

(%)

6 4

1 2 0

0 -2

-1 -4 -2

-6 -8

-3 -10

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

-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

Aug Sep

Oct

Real GDP

1.9

2.4

0.6

0.7

0.4

0.2

Industrial production

1.6

2.9

0.0

1.0

1.6

1.3 -0.6

0.1

-0.1

1.2 -0.6

0.2

Retail sales

1.6

2.3

0.3

0.8

0.4

0.8

-0.1

0.4 -0.5

0.3

Exports (y-o-y)

0.3

7.1 11.2

5.4

6.0

6.2

2.1

4.3

4.6

5.4 -0.8 11.4

Consumer prices (y-o-y)

0.2

1.5

1.4

1.3

1.7

2.1

2.0

Sources: Eurostat, Bloomberg

1.8

2.1

2.2

December 2018

2. Private consumption Private consumption (preliminary GDP) in the third quarter of 2018 rose 0.5 percent from the previous quarter and 2.5 percent compared with 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

0.5

2.4

2.8

1.4

2.1

2.4

2.6

3.4

3.5

2.8

2.5

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)

-6 2009.Q1

Private consumption (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)

Retail sales in October rose 0.2 percent from the previous month: Sales of durable goods (up 1.7%) and semi-durable goods (up 0.4%) rose, and sales of nondurable goods (down 0.6%) declined. Year-on-year, the index rose 5.0 percent. (Percentage change from previous period)

2016

2017

2018

Annual

Q31

Sep1 Oct1

3.9

1.4

1.9

0.4

1.0

0.2

0.9

3.0

0.7

-0.6

-2.1

0.2

2.2

1.6

1.0

3.2

2.1

5.0

4.7

3.8

0.4

5.0

4.6

6.5

5.4

1.0

5.2

-3.0

1.4

5.4

2.2

-4.7

-7.5

1.7

2.8

16.5

0.9

-0.5

3.5

-6.9

1.4 11.0

3.8

-8.6 -12.4

7.1

- Semi-durable goods

2.3

-0.1

-1.1

-1.3

-0.5

1.1

1.4

2.8

1.0

2.0

0.4

- Nondurable goods

4.2

-0.3

1.7

0.8

-0.5

1.4

0.5

2.1

-0.3

0.5

-1.1

-0.6

Retail sales (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

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 -5

Durable goods Semi-durable goods Nondurable goods

-10 -15 2009.1

2010.1

2011.1

2012.1

Source: Statistics Korea (industrial activity trends)

In December both the sales in department stores and large discount stores dropped, as well as consumer sentiment. However, credit card use and the number of Chinese tourists increased. 2018 Apr

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

May

Jun

Jul

Aug

Sep

Oct

Nov1

14.1

5.2

7.7

9.7

8.8

1.9

13.2

6.7

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

0.5

2.0

5.0

3.2

2.9

4.3

3.9

-3.4

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

-2.0

-3.0

0.9

-2.5

2.0

7.5

-12.2

-1.7

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

1.3

-0.3

-5.9

3.3

6.8

-18.7

23.1

-0.4

107.1 107.9 105.5 101.0 Consumer sentiment index Number of Chinese tourists (y-o-y, %) 60.9 46.1 49.0 45.9

99.2

100.2

99.5

96.0

41.0

36.4

37.7

41.12

1. â&#x20AC;&#x152; Preliminary 2. A â&#x20AC;&#x152; dvanced 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

December 2018

3. Facility investment Facility investment (preliminary GDP) in the third quarter of 2018 fell 4.4 percent quarter-on-quarter and 7.4 percent year-on-year. (Percentage change from previous period)

2016

2017 Q2

Q21

Q31

14.6

4.5

4.3

0.2

-0.7

3.4

-5.7

-4.4

16.1

17.9

16.3

8.6

7.3

-3.0

-7.4

- Machinery

-0.8

23.0

7.1

3.9

2.4

-1.2

4.0

-4.5

-9.5

- Transportation equipment

-1.5

-3.2

-1.7

5.3

-5.5

0.8

1.9

-9.3

10.6

Facility investment2 (y-o-y)

Annual

-1.0

2018

Annual

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

2015.Q1

2016.Q1

2017.Q1

2018.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)

Economic Bulletin

The Green Book

The facility investment index in October rose 1.9 percent month-on-month as transportation equipment investment increased. The index rose 9.4 percent yearon-year. (Percentage change from previous period)

2016

2017

Facility investment index (y-o-y)

-1.3

2018

Q31

Sep1

Oct1

14.1

6.0

3.1

0.2

-1.7

8.4 -11.0

-6.1

3.3

1.9

Annual Annual

18.2

17.8

20.6

2.0

9.4

-5.9 -13.6 -19.1

9.4

- Machinery

-2.2

22.4

6.6

7.9

-0.1

-2.0

5.3

-9.5 -10.0

11.0

-0.9

- Transportation equipment

0.9

-4.4

5.1

-8.7

0.4

-0.8

4.8 -13.7

10.0

17.8 -15.5

1. Preliminary Source: Statistics Korea

BOK’s manufacturing BSI fell, but other leading indicators, such as domestic machinery orders received and machinery imports, improved. BSI in the manufacturing sector (base=100, Bank of Korea)

79 (Jun 2018) → 80 (Jul) → 73 (Aug) → 77 (Sep) → 78 (Oct) → 72 (Nov) → 71 (Dec) (Percentage change from same period in previous year)

2016

2017

Annual Annual

2018 Q3

Q31

Sep1 Oct1

4.2

4.4

-0.4

-0.1

-0.8

7.6

0.3

-8.9

7.2

1.7 -15.4

8.3

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 74.2 73.8 74.0

Capacity utilization rate Facility investment pressure

19.2 21.1 23.7 31.3

-0.4

0.5

-8.6 11.4

1.4

8.4

-0.9 -54.0 -12.7 18.9

2.6

-5.8

0.2

3.9

6.1

9.1 21.0

-4.7

-2.5

-1.7

7.7 26.0 37.1 -0.6

-1.8

5.4

-1.2 -13.2 -18.1 13.0

1.5

-0.7

-7.0 12.9

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, %)

9 40

8 7

6 0

5 4

-20

Machinery orders (left) Machinery imports (right)

-40 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)

December 2018

4. Construction investment Construction investment (preliminary GDP) in the third quarter of 2018 fell 6.7 percent quarter-on-quarter and 8.9 percent year-on-year. (Percentage change from previous period)

2016

2017

Annual

10.3

7.6

Construction investment

(y-o-y)

2018 1

Q21

Q31

4.2

0.9

1.1

-2.3

1.8

-2.1

-6.7

11.3

8.5

8.0

3.8

1.8

-1.5

-8.9

- Building construction

16.2

12.1

4.5

2.4

1.9

-1.6

0.7

-1.1

-6.7

- Civil engineering works

-1.8

-3.5

3.5

-3.0

-1.2

-4.2

5.3

-4.7

-6.6

1. Preliminary

2. National accounts Source: Bank of Korea

Construction investment (%) 15

-5

-10

Construction investment (y-o-y)

-15 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

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

-20

Residential buildings

-30

Civil engineering works

2009.Q1

2010.Q1

2011.Q1

2012.Q1

Source: Bank of Korea (national accounts)

2013.Q1

Economic Bulletin

The Green Book

Construction completed (constant) in October decreased 2.2 percent month-onmonth as both building construction and civil engineering works declined. The index decreased 3.5 percent year-on-year. (Percentage change from previous period)

2016

2017

Annual Annual

Construction completed (constant)

2018

Q31 Sep1 Oct1

15.4

10.1

4.3 -0.2 -0.3 -0.1

2.5 -4.9 -4.4 -3.5 -2.2

17.7 13.6 12.7 -0.5

1.5 -3.4 -9.8 -16.6 -3.5

- 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 -5.0 -3.5 -1.2 7.4 -12.3 -2.4 -3.4 -5.5

Source: Statistics Korea

Leading indicators show mixed signals: Apartment presales and construction orders received increased, but 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) → 27 (Oct) → 28 (Nov) (Percentage change from same period in previous year)

2016

2017

Annual Annual

2018 Q2

Q31

Sep1 Oct1

1.2 17.9 -10.2 -15.0

3.6 -15.7

-5.6

-4.1 12.6

8.0 -11.1

6.8 19.6 -26.9

Construction orders received (current value)

8.1

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

-5.4

8.5 -10.6

- Building construction

14.4

-6.5

-7.7

8.4

- Civil engineering works

-10.5

9.7 29.7 63.3 -17.3 -13.0 13.0 -19.1 68.2 103.1

Building permits

-5.7

-3.1

-4.0

-5.0

-7.8

-1.1

-8.3 -15.5

-0.3

-2.4

-0.5 -14.7 -23.8 -23.8 14.6

3.7

4.3

-7.2 -10.2 -33.2 -11.1

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

Construction orders Building permit area

-100 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

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

December 2018

5. Exports and imports Exports (preliminary) increased 4.5 percent year-on-year to US $51.92 billion in November, the third largest on record. Exports for the first 11 months of 2018 posted US $557.2 billion, hitting a record high. By item, vessels, petroleum products, semiconductors, petrochemicals and steel rose, while home appliances and wireless communications devices dropped. By region, shipments to the EU, the ASEAN countries, India, Japan, the US and Vietnam increased, while exports to Latin America and the Middle East declined. Export growth by item (y-o-y, %)

158.4 (vessels), 23.5 (petroleum products), 11.6 (semiconductors), 3.8 (petrochemicals), 2.7 (steel), -16.8 (home appliances), -42.2 (wireless communications devices)

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

23.7 (EU), 13.0 (ASEAN countries), 11.8 (India), 9.4 (Japan), 7.9 (US), 2.6 (Vietnam), -12.2 (Latin America), -30.6 (Middle East)

Average daily exports, an indicator calculated according to days worked, rose 4.5 percent year-on-year to US $2.16 billion. Average daily export growth (y-o-y, %)

6.6 (Jun 2018) → 3.9 (Jul) → 8.7 (Aug) → 10.7 (Sep) → -4.0 (Oct) → 4.5 (Nov)

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

140 120 100 80 60 40 20 0

Export growth rate Semiconductors Automobiles Steel

-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

2017

Annual Annual

Exports

2018 Q3

Nov

Oct

Nov1

495.43 573.69 132.06 147.04 151.05 143.54 49.71 145.07 151.66 153.58 54.97 51.92

(y-o-y, %)

-5.9

15.8

14.7

16.7

24.0

8.4

9.7

9.9

3.1

1.7

22.7

4.5

Average daily exports

1.81

2.13

1.96

2.21

2.13

2.23

2.07

2.17

2.30

2.28

2.39

2.16

1. Preliminary Source: Korea Customs Service

Economic Bulletin

The Green Book

Imports (preliminary) in November rose 11.4 percent year-on-year to US $46.78 billion. Imports of commodities and consumer goods continued to grow, though at a slower pace, and capital goods imports fell. Import growth by category (y-o-y, %, Oct → Nov)

38.4 → 25.2 (commodities), 10.9 → -3.8 (capital goods), 34.9 → 3.7 (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

2017

Annual Annual

Imports

2018 Q3

Nov

Oct

Nov1

406.19 478.48 116.43 117.80 120.85 123.40 42.01 132.38 133.02 130.32 48.48 46.78

(y-o-y, %)

-6.9

17.8

24.1

18.6

17.9

11.6

12.8

13.7

12.9

7.8

28.1

11.4

Average daily imports

1.49

1.78

1.72

1.77

1.70

1.91

1.75

1.98

2.02

1.93

2.11

1.95

1. Preliminary Source: Korea Customs Service

The trade balance (preliminary) posted a surplus of US $5.14 billion in November, staying in the black for the 82nd consecutive month. Surpluses decreased monthon-month. (US $ billion)

2016 Annual Annual

Trade balance

2017 Q1

2018 Q4

89.23 95.22 15.63 29.25 30.20 20.14

1. Preliminary Source: Korea Customs Service

Nov

7.69 12.69 18.64 23.26

Oct

Nov1

6.47

5.14

December 2018

6. Mining and manufacturing production Mining and manufacturing production rose 1.0 percent month-on-month in October as manufacturing, mining, and gas & electricity all improved. The index rose 10.7 percent year-on-year. Compared to the previous month, production of processed metals (up 6.4%), other transportation equipment (up 8.0%) and pharmaceuticals (up 8.2%) rose, while automobiles (down 2.5%), chemical products (down 2.6%) and primary metals (down 2.0%) fell. Compared to a year ago, production of automobiles (up 28.6%), semiconductors (up 14.7%) and mechanical equipment (up 10.2%) rose, while electronic components (down 3.7%), broadcasting & communications equipment (down 8.2%) and audiovisual equipment (down 14.7%) declined. The manufacturing inventory-shipment ratio rose 0.8 percentage points monthon-month to 107.7 percent as inventories rose 0.6 percent and shipments fell 0.1 percent. Inventories of processed metals (up 8.3%), refined petroleum (up 5.0%) and electrical equipment (up 2.3%) rose, while semiconductors (down 4.7%), automobiles (down 2.0%) and mechanical equipment (down 2.3%) declined. Shipments of other transportation equipment (up 6.3%), pharmaceuticals (up 7.7%) and rubber & plastics (up 1.7%) rose, while primary metals (down 3.4%), electrical equipment (down 3.9%) and refined petroleum (down 2.0%) fell. The capacity utilization rate of the manufacturing sector improved 0.2 percentage points month-on-month to 74.0 percent. Strong exports and recovering global economies are expected to support mining and manufacturing, but there are concerns regarding trade conflicts between the US and China, Fedâ&#x20AC;&#x2122;s rate hikes and global financial market volatility. (Percentage change from same period in previous year)

2017 Annual Q3

Q31

Aug Sep1 Oct1

0.8

0.5

2.7

0.7

1.3

-2.7

(y-o-y)

1.9

4.6

-5.6

0.7

-1.7

2.5

-8.4 10.7

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

0.6

0.3

3.0

0.4

1.6

-2.1

(y-o-y)

1.6

4.6

-6.2

0.5

-2.2

2.0

-8.9 11.1

Shipment

0.7

4.3

-6.7

-0.8

-3.1

0.8

-9.0 11.0

-Domestic consumption

1.4

6.1

-7.6

-1.3

-5.1

0.1 -12.5 12.6

-Exports

-0.3

1.8

-5.4

-0.1

-0.3

1.9

-3.9

8.9

Inventory3

8.8

2.5

6.4

8.2

5.2

4.5

5.2

2.6

Production

Capacity utilization rate Production capacity 1. Preliminary

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

Mining and manufacturingÂ˛

Manufacturing

2018 Oct

1.0 0.8

72.6 73.0 73.3 73.2 74.2 75.7 73.8 74.0 1.1

0.7

0.2

2. Including mining, manufacturing, electricity and gas industry

-1.0

-1.5

-1.9

3. At the end of the period

-1.8

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

2013.1

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 (%)

60 2009.1

2010.1

2011.1

2012.1

Source: Statistics Korea (industrial activity trends)

December 2018

7. Service sector activity Service output increased 0.3 percent month-on-month in October. Wholesale & retail and financial & insurance services rose, while healthcare & welfare services declined, along with hotels & restaurants. Compared to a year ago, service output rose 5.4 percent.

Service sector activity (%) 10 8 6 4 2 0 -2

Service sector activity (y-o-y)

-4 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Service sector activity (m-o-m)

Source: Statistics Korea (industrial activity trends)

(Percentage change from previous period)

Weight

2016 2017 Annual Annual

2018 Q1

Q31

Sep1

Oct1

Service activity index

100.0

2.6

1.9

1.0

0.2

0.1

0.3

- Wholesale & retail

21.1

2.6

0.7

1.0

-0.6

-0.1

-1.7

0.8

- Transportation & storage services

9.0

2.2

1.6

-0.6

3.7

-1.1

0.9

-0.7

- Hotels & restaurants

6.2

2.3

-1.9

-2.0

1.6

0.3

2.0

-2.0

- Publishing & communications services

8.0

2.5

1.5

-2.0

1.2

-2.3

-1.5

14.1

4.1

5.1

1.4

1.0

-1.5

1.5

1.6

- Real estate & renting

3.2

0.6

1.2

5.1

-0.6

0.2

5.4

-2.3

- Professional, scientific & technical services

7.1

-0.8

-1.6

3.2

0.0

-1.5

-2.8

2.7

- Business services

4.8

1.5

4.3

0.2

-1.9

-1.2

-0.4

2.5

- Education services

10.6

0.7

0.0

0.1

0.4

-0.6

-0.2

1.6

- Healthcare & welfare services

9.4

8.1

7.0

1.5

-0.2

6.4

1.3

-2.9

- Entertainment & leisure

2.2

2.3

0.2

2.0

-1.7

-0.5

5.8

-4.7

- Membership organizations & personal services

3.2

0.3

0.0

1.4

0.1

-1.9

-0.7

4.7

- Sewerage & waste management

1.1

3.1

-2.3

2.3

1.0

-0.7

-3.8

11.0

- Financial & insurance services

1. Preliminary Source: Statistics Korea

Economic Bulletin

The Green Book

October 2018 service output by business (y-o-y, %) Sewerage & waste management

16 14

Real estate & renting

Membership organizations & personal services

12 Financial & insurance services

Professional, scientific & technical services

8 6

Total Wholesale & index retail

Healthcare & social welfare services

Transportation & storage services

Publishing & communications services Hotels & restaurants

2 0

Entertainment & leisure

Education Business services services

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 November department store sales and large discount store sales declined, as well as stock transactions, but the number of Chinese tourists visiting Korea increased. 2018 Sep

Oct

Nov1

3.3

6.8 -18.7

23.1

-0.4

5.0

3.2

2.9

3.9

-3.4

7.5 -12.2

-1.7

Apr

May

Jun

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

1.3

-0.3

-5.9

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

0.5

2.0

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

Jul

Aug

4.3

-2.0

-3.0

0.9

-2.5

2.0

Average daily stock transactions (trillion won) 14.3

15.0

12.5

9.0

8.8

10.8

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

46.1

49.0

45.9

41.0

36.4

60.9

9.6

8.4

37.7 41.12

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

December 2018

8. Employment The number of workers on payroll in November increased by 165,000 from a year earlier to 27,184,000, and the employment rate (aged 15-64) rose 0.1 percentage points to 67.1 percent. By industry, jobs in services and construction grew, while manufacturing jobs declined at a faster rate. By employment status, permanent workers led job growth, while self-employed, temporary and daily workers continued to decrease.

Employment by industry (%) 100

80 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 69.8 70.1

Services Construction Manufacturing

7.3 7.3 7.3 7.4 7.5 7.5 7.4 7.3 7.5 7.5 7.6 7.7 7.6 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.6 7.7 7.8 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 16.7 16.5

3.4 3.7 4.4 5.0 5.3 5.4 5.2 5.3 5.3 5.3 5.0 4.0 3.8 3.8 4.5 5.2 5.5 5.5 5.4 5.5 5.5 5.5 5.3 2017.1 2 3 4 5 6 7 8 9 10 11 12 2018.1 2 3 4 5 6 7 8 9 10 11

Agriculture, forestry & fisheries

Source: Statistics Korea (employment trends)

Employment by status of workers (%) 100

3.7

3.8

4.0

4.3 4.3

4.4 4.3

4.3

4.4

4.2 3.7

3.7 3.7 3.9

4.2

4.3

4.4 4.3

4.4

4.3 4.2

4.2

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 20.9 20.7

80 5.7

5.5

5.4

5.8 5.9

5.9 5.9

5.4

5.6

5.7 5.6

5.4

5.2 5.3

5.4

5.4 5.4

5.2

5.5 5.6

5.8

17.8 17.5 18.1 18.3 18.4 18.4 18.5 18.1 18.0 18.1 18.2 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

Unpaid family workers

Self-employed workers Daily workers Temporary 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 51.2 51.1

0 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) Number of employed (seasonally adjusted, right)

-400 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

Number of employed (millions)

2018 Q3

Nov

26.73 26.10 26.92 27.00 26.88 27.02 26.28 27.02 27.02 27.18

Employment rate (%)

60.8

59.6

61.3

61.4

61.0

61.4

59.6

61.2

61.1

61.4

(Seasonally adjusted)

60.8

60.9

60.8

60.9

60.7

60.5

60.9

- 15 to 64

66.6

65.8

66.9

67.0

66.9

67.0

66.0

66.9

66.7

67.1

Employment growth (y-o-y, thousands)

316

353

367

279

265

257

183

101

165

- Manufacturing

-18

-120

-21

-91

- Construction

119

136

163

- Services

209

360

224

144

103

146

125

114

-74

-50

-87

-69

· Hotels & restaurants

-3

-31

-40

-35

-24

-69

-59

· Healthcare & social welfare services

148

142

164

· Wholesale & retail

- Wage workers

265

191

312

291

265

275

228

113

248

·Permanent workers

366

317

347

417

382

376

409

335

293

343

·Temporary workers

-132

-152 -126 -145 -104

·Daily workers - Nonwage workers ·Self-employed workers

-95 -124 -109 -162 -116

-13

-6

-57 -113

-67

161

-12

-18

-45

-13

-48

-83

168

-24

-3

-55

-78

- Male

127

171

174

-14

-48

- Female

189

182

192

187

193

186

109

115

141

- 15 to 29

-1

-7

-42

-30

-69

-27

- 30 to 39

-29

-53

-27

-18

-17

-22

-29

-33

-91

-98

- 40 to 49

-50

-41

-48

-55

-54

-67

-85 -101 -143 -129

- 50 to 59

152

177

159

139

134

131

- 60 and above

242

254

251

221

243

244

203

241

252

270

Source: Statistics Korea

December 2018

The number of unemployed persons in November was up by 38,000 from a year earlier to 909,000, and the unemployment rate rose 0.1 percentage points to 3.2 percent. The unemployment rate fell year-on-year among young adults, and rose among those aged 40 and older.

Unemployment rate (%)

Original data Seasonally adjusted rate

2 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

2018

Annual

Number of unemployed (thousands)

1,023

1,162

1,074

963

892

871

1,181

1,105

1,065

909

Unemployment growth (y-o-y, thousands)

-20

102

- Male

-15

-8

-12

-28

-19

Unemployment rate (%)

3.7

4.3

3.8

3.4

3.2

3.1

4.3

3.9

3.8

3.2

(Seasonally adjusted)

3.7

3.8

4.0

3.8

- 15 to 29

9.8

10.7

10.3

9.3

9.0

9.2

10.0

10.1

9.4

7.9

- 30 to 39

3.3

3.6

3.4

3.0

2.9

3.3

3.6

2.9

- 40 to 49

2.1

2.4

2.0

1.8

2.5

2.6

2.2

- 50 to 59

2.2

2.4

2.3

1.8

1.6

2.5

2.6

2.2

- 60 and above

2.9

4.8

2.3

2.2

1.9

5.4

2.5

2.3

- Female

Source: Statistics Korea

Nov

Economic Bulletin

The Green Book

The economically inactive population in November increased by 41,000 from a year earlier to 16,192,000, and the labor force participation rate rose 0.1 percentage points to 63.4 percent. The number of persons economically inactive due to rest (up 90,000) and housework (up 39,000) increased, and those due to education (down 199,000) and childcare (down 41,000) decreased. Job seekers were up by 69,000.

Labor force participation rate (%)

Original data

59 2009.1

Seasonally adjusted rate

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

Nov

16.18 16.56 15.91 16.01 16.26 16.15 16.62 16.02 16.13 16.19

Labor force participation rate (%)

63.2

62.2

63.8

63.6

63.1

63.3

62.3

63.7

63.5

63.4

(Seasonally adjusted)

63.2

63.1

63.2

63.3

63.1

63.3

-5

-20

-85

110

126

-96

-86

-88

-105

-107

-100

-80

-87

-86

-41

-33

-20

- Education

-91

-63

-131

-88

-81

-83

-58

-62

-128

-199

- Old age

-7

108

166

220

222

107

127

137

-10

-30

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

- Rest - Job seeking Source: Statistics Korea

December 2018

9. Financial markets 9.1 Stock market KOSPI rose 3.3 percent in November from 2,029.7 points to 2,096.9 points as uncertainties removed after the US mid-term elections, as well as amid expectations about the US-China summit. KOSDAQ rose 7.3 percent from 648.7 points to 695.8 points.

(Closing rate)

KOSPI

KOSDAQ

Oct 2018 Nov 2018

Change

Oct 2018 Nov 2018

Stock price index (points)

2,029.7

2,096.9

67.2 (3.3%)

648.7

695.8

47.1 (7.3%)

Market capitalization (trillion won)

1,361.5

1,403.5

42.0 (3.1%)

216.6

233.0

16.4 (7.6%)

6.1

5.3

-0.81 (-13.3%)

3.5

3.1

-0.3 (-9.6%)

36.7

36.0

-0.7 (-1.9%)

11.1

11.0

-0.0 (-0.4%)

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

1. Change from the end of the previous month as of end-November 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

Change1

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 declined 1.6 percent in November from 1,139.6 won to 1,121.2 won following an interest rate hike by the Bank of Korea and also on signs that Fed may slow its rate increases next year. The 100 yen-won exchange rate fell 1.8 percent from 1,006.5 won to 988.8 won amid a strong won. (Closing rate1)

2012

2013

2014

2015

2016

2017

Dec

Oct

Nov

Change2

1,070.6

1,055.4

1,099.3

1,172.5

1,207.7

1,070.5

1,139.6

1,121.2

1.6

100 Yen-Won 1,238.3

1,002.3

913.0

974.1

1,035.4

949.3

1,006.5

988.8

1.8

Dollar-Won

2018

1. The exchange rate is based on the closing price at 3:30 p.m., local time. â&#x20AC;&#x152; 2. Appreciation from the end of the previous month as of end-November 2018 (%) Source: Bank of Korea

Foreign exchange rates (month-end, â&#x201A;Š) 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 November due to falling international oil prices, skepticism about the US-China trade relationship and expectations that the Bank of Korea may refrain from raising interest rates next year. Yield to maturity (m-o-m, basis points)

-4.2 (3 yrs), -9.4 (5 yrs), -13.7 (10 yrs), -14.0 (20 yrs), -16.7 (30 yrs)

December 2018

(Closing rate, %)

2012

2013

2014

2015

2016

2017

2018

Dec

Sep

Oct

Nov

Call rate (1 day)

2.77

2.52

2.03

1.52

1.27

1.58

1.65

1.57

1.76

19.0

CD (91 days)

2.89

2.66

2.13

1.67

1.52

1.66

1.65

1.70

1.90

20.0

Treasury bonds (3 yrs)

2.82

2.86

2.10

1.66

1.64

2.14

2.01

1.94

1.90

-4.2

Corporate bonds (3 yrs)

3.29

2.43

2.11

2.13

2.68

2.45

2.39

2.37

-2.6

Treasury bonds (5 yrs)

2.97

3.23

2.28

1.81

1.80

2.34

2.18

2.07

1.97

-9.4

Change1

1. Basis points, %p, change from the previous month as of end-November 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

2012.1

2011.1

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 October rose 6.8 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

Sep

Oct

Oct1

M12

6.6

3.8

9.5

10.9

18.6

15.4

9.2

4.3

1.7

840.7

4.2

5.2

4.8

6.6

8.6

7.3

5.5

6.4

6.8

2,674.5

5.3

7.8

6.9

7.0

9.7

8.1

6.7

7.2

7.4

3,759.6

2018

1. Balance at end-October 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 grew slowly in November from 11.5 trillion won to 0.2 trillion won: Instant access deposits fell 3.8 trillion won, and time deposits declined 0.8 trillion won as local governments withdrew funds for year-end spending. Asset management company (AMC) deposits decreased 1.2 trillion won: Money market funds (MMFs) fell 6.3 trillion won as banks withdrew funds, as well as the government. (Change from the end of the previous period, trillion won)

2011

2012

2013

2014

2015

2016

2017

2018

Annual Annual Annual Annual Annual Annual Annual

Sep

Oct

Nov

Nov1

Bank deposits

58.9

37.0

41.0 115.4 100.3

80.8

79.5

15.4

11.5

0.2 1,628.3

AMC deposits

-16.6

18.8

17.7

47.6

27.9

-13.4

20.6

-1.2 561.0

42.4

44.4

1. Balance at end-November 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

December 2018

10. Balance of payments Korea’s current account (preliminary) in October posted a surplus of US $9.19 billion, staying in the black for 80 consecutive months. Goods account surpluses decreased month-on-month from US $13.24 billion to US $11.00 billion. Growth in goods exports (y-o-y, %) -5.5 (Sep 2018) → 28.8 (Oct)

Growth in goods imports (y-o-y, %) -3.2 (Sep 2018) → 29.0 (Oct)

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

22.7 (total), 75.0 (petroleum products), 3.3 (computers), 22.1 (semiconductors), 5.5 (home appliances)

Import growth by category in October (y-o-y, %, customs clearance basis) 28.1 (total), 38.4 (commodities), 10.9 (capital goods), 34.9 (consumer goods)

Services account deficits decreased month-on-month from US $2.52 billion to US $2.22 billion. Services balance (US $ billion, Sep → Oct)

0.03 → -0.39 (transportation), 0.67 → 0.73 (construction), -0.43 → -0.27 (intellectual property rights), -0.64 → -0.67 (manufacturing), -1.13 → -0.95 (travel), -1.17 → -0.95 (others)

Surpluses in the primary income account increased from US $0.67 billion to US $0.96 billion, and deficits in the secondary income account decreased from US $0.56 billion to US $0.54 billion.

Current account balance (US $ billion)

18 15 12 9 6 3 0

Goods account

-3

Services account

-6

Current account

2009.1

2010.1

2011.1

2012.1

Source: Bank of Korea (balance of payments trends)

2013.1

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

Q31

2018 Q41

Oct1

Q11

Q21

Q31

Oct1

78.46 19.20 16.45 25.57 17.24 5.72 11.83 17.83 28.03 9.19

- Goods balance

118.90 119.89 27.31 29.56 34.75 28.27 8.60 23.91 31.78 35.91 11.00

- Services balance

-17.74 -34.47 -8.66 -6.75 -8.50 -10.56 -3.53 -9.41 -6.53 -7.75 -2.22

- Primary income balance

3.85

- Secondary income balance -5.77

0.12 1.37 -4.88 1.95

1.68 1.17 0.39 -5.17 1.94 0.96

-7.08 -0.82 -1.48 -2.63 -2.15 -0.52 -3.06 -2.26 -2.07 -0.54

1. Preliminary Source: Bank of Korea

The capital and financial account (preliminary) in October posted an outflow of US $10.59 billion. Capital & financial account balance* (US $ billion)

6.75 (May) → 4.63 (Jun) → 10.46 (Jul) → 7.28 (Aug) → 9.73 (Sep) → 10.59 (Oct) * Positive figures represent net outflows, and negative figures represent net inflows.

Net outflows increased in foreign direct investment (FDI) (US $2.17 billion in September → US $3.36 billion in October) as Korean FDI (US $2.47 billion outflow → US $4.32 billion outflow) grew faster than inbound FDI (US $0.30 billion inflow → US $0.96 billion inflow). Net outflows decreased in portfolio investment (US $9.13 billion in September → US $6.75 billion in October) as Korean investment in foreign shares grew slowly (US $7.72 billion outflow → US $2.67 billion outflow). Outflow continued in foreign investment in Korean shares (US $1.40 billion outflow → US $4.08 billion outflow). Net outflows increased in financial derivatives investment (US $0.44 billion → US $0.77 billion), and net inflows decreased in other investment (US $3.91 billion → US $2.45 billion). Current account surpluses are likely to decrease in November given a fall in trade surpluses (US $6.50 billion in October → US $5.10 billion in November).

Capital & financial account balance (US $ billion) 15 12 9 6 3 0 -3

Capital & financial account Direct investment Portfolio investment

-6 -9 -12

2009.1

2010.1

2011.1

2012.1

Financial derivatives

Source: Bank of Korea (balance of payments trends)

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

December 2018

11. Prices 11.1 Consumer prices Consumer prices in November fell 0.7 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)

-1 2009.1

Consumer price inflation (m-o-m)

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 Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Consumer price inflation (m-o-m) 0.8

-0.1

0.2

0.0

-0.2

0.9

0.8

-0.2

-0.7

(y-o-y)

1.2

1.5

1.1

1.4

2.1

2.0

1.3

Source: Statistics Korea

Fresh food prices went up at a slower pace (up 8.5% → up 7.6%, y-o-y) as supplies improved. Domestic oil prices fell from the previous month amid falling international oil prices and a strong won, as well as due to oil tax cuts (down 3.4%, m-o-m, up 11.8% → up 6.6%, y-o-y). Public utility prices rose (down 1.9% → up 1.5%, y-o-y) as the effect of last year’s natural gas rate cuts diminished. Personal service prices rose at a faster rate (up 2.5% → up 2.8%, y-o-y) due to a low base effect from a year ago.

Economic Bulletin

The Green Book

Consumer price inflation in major sectors Manufactured Oil Public Housing Public Personal products products utilities rents services services

Total

Fresh foods

Oct (y-o-y, %)

2.0

8.5

1.6

11.8

-1.9

0.4

0.1

2.5

Nov (y-o-y, %)

2.0

7.6

1.4

6.6

1.5

0.3

0.2

2.8

0.56

0.46

0.33

0.05

0.03

0.79

- Contribution (%p) Source: Statistics Korea

Contribution to consumer price inflation (%p) 5

Personal services

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

-1

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Source: Statistics Korea (consumer price trends)

Core inflation, which excludes oil and agricultural products, accelerated in November as personal service prices rose. (Percentage change from same period in previous year)

2018 Apr May Jun

Jul

Aug Sep

Oct

Nov

Consumer prices excluding oil and agricultural products 1.4

1.3

1.2

0.8

0.9

1.3

1.2

1.4

Consumer prices excluding food and energy

1.4

1.3

1.0

1.1

1.0

1.2

1.4

Source: Statistics Korea

The fresh food price index rose at a slower rate (up 11.2% â&#x2020;&#x2019; up 10.5%, y-o-y) in November. (Percentage change from same period in previous year)

2018 Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Consumer prices for basic necessities

1.5

1.1

1.5

2.5

2.6

2.3

Fresh food prices

3.1

1.9

-0.2

-1.3

4.8

11.0

11.2

10.5

Source: Statistics Korea

December 2018

Prices (y-o-y, %)

-3

Consumer price inflation Core inflation

-6 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

Producer price inflation

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

11.2 International oil and commodity prices International oil prices fell amid concerns about a supply glut and a slowdown in global growth. Dubai crude (US $/barrel)

70.68 (1st week Nov 2018) → 67.08 (2nd week) → 63.57 (3rd week) → 59.14 (4th 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

Aug

Sep

Oct

Nov

Dubai crude

53.2

64.0

72.1

74.2

72.5

77.2

79.4

65.6

WTI crude

50.9

62.9

67.9

69.4

67.8

70.1

70.7

56.7

Brent crude

54.7

67.2

75.0

75.8

73.8

79.1

80.6

65.9

Source: Korea National Oil Corporation

Domestic gasoline prices continued to fall in November due to oil tax cuts and declining international oil prices. Domestic gasoline prices (won/liter)

1,660.4 (1st week Nov 2018) → 1,575.2 (2nd week) → 1,546.5 (3rd week) → 1,516.3 (4th week)

International gasoline prices (US $/barrel)

80.5 (4th week Oct 2018) → 77.9 (5th week) → 72.0 (1st week Nov) → 68.2 (2nd week)

Dollar-won exchange rate (won)

1,134 (4th week Oct 2018) → 1,139 (5th week) → 1,122 (1st week Nov) → 1,131 (2nd week)

(Won/liter, period average)

2017

2018

Annual

Aug

Sep

Oct

Nov

Gasoline prices

1,491

1,558

1,580

1,622

1,618

1,638

1,681

1,581

Diesel prices

1,283

1,353

1,380

1,423

1,419

1,439

1,485

1,425

Source: Korea National Oil Corporation

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

Dubai crude (import prices, left) Dubai international prices (right)

(US $/B)

160

140

120

100

20 2009.1

2010.1

2011.1

2012.1

Source: Korea National Oil Corporation

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

December 2018

International soybean prices rose in November as bad weather delayed harvests and output forecasts were trimmed in major soybean producing countries. Wheat prices fell as forecasts for global output and inventories were revised upwards. International grain prices in November (monthly average prices, m-o-m, %) 0.0 (corn), -0.5 (wheat), 2.5 (soybeans)

Copper and aluminum prices fell on demand concerns amid a slowing global economy, and nickel prices declined as Russia and the Philippines planned to boost production. Nonferrous metal prices in November (monthly average prices, m-o-m, %) -0.4 (copper), -4.7 (aluminum), -8.7 (nickel)

(Period average)

2017 1

Reuters Index

(Sep 18, 1931=100)

2018

Annual

Aug

Sep

Oct

Nov

2,472

2,342

2,317

2,309

2,329

2,299

2,392

2,378

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

International commodity prices (points)

(points)

500

4,000

450 400

3,000

350 300

2,000

250 1,000

200 150

CRB (left) Reuters index (right)

100 2009.1

2010.1

2011.1

2012.1

2013.1

2014.1

2015.1

2016.1

2017.1

2018.1

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 0.13 percent month-on-month in November. Housing prices rose 0.25 percent in the Seoul metropolitan area which includes Seoul (up 0.20%), Gyeonggi Province (up 0.26%) and Incheon (up 0.30%). Housing prices rose 0.14 percent in the five metropolitan cities and declined 0.06 percent in the eight provinces. Housing prices in five metropolitan cities (m-o-m, %)

Busan (-0.13), Daegu (0.53), Gwangju (0.46), Daejeon (0.63), Ulsan (-0.83)

Housing sales prices

(Percentage change from previous period)

2014 2015 2016

2017

Annual Annual Annual Annual

2018

Nov Jan-Nov Aug

Sep

Oct

Nov

Nationwide

1.7

3.5

0.7

1.5

0.13

1.1

0.02

0.31

0.19

0.13

Seoul metropolitan area

1.5

4.4

1.3

2.4

0.25

3.2

0.24

0.70

0.42

0.25

- Seoul

1.1

4.6

2.1

3.6

0.36

6.2

0.63

1.25

0.51

0.20

Âˇ Gangnam

1.2

5.2

2.5

4.4

0.45

6.6

0.62

1.45

0.45

0.08

Âˇ Gangbuk

1.1

3.9

1.8

2.9

0.27

5.7

0.64

1.04

0.57

0.34

1.9

2.7

0.2

0.7

0.02

-0.8

-0.17

-0.04

-0.02

0.02

Areas excluding the Seoul metropolitan area

1. 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

December 2018

Housing rental prices nationwide declined 0.09 percent month-on-month in November. Housing rental prices fell 0.06 percent in the Seoul metropolitan area and 0.12 percent in areas excluding the Seoul metropolitan area. Housing rental prices in major districts in the Seoul metropolitan area (m-o-m, %) Gangnam (-0.05), Seocho (-0.27), Gangdong (-0.08), Seongdong (0.33), Gwacheon (1.88)

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

Nationwide Seoul metropolitan area Areas excluding Seoul metropolitan area

-1

-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

Nov Jan-Nov Aug

Sep

Oct

Nov

Nationwide

3.4

4.8

1.3

0.6

0.05

-1.6

-0.20

-0.08

-0.05

-0.09

Seoul metropolitan area

4.7

7.1

2.0

1.4

0.13

-1.3

-0.12

0.04

0.06

-0.06

- Seoul

3.6

7.2

2.0

0.21

0.4

0.20

0.26

0.17

0.00

Âˇ Gangnam

3.3

7.9

1.8

2.6

0.28

-0.1

0.29

0.36

0.18

-0.05

Âˇ Gangbuk

3.8

6.5

2.1

1.5

0.14

0.9

0.10

0.15

0.17

0.05

2.2

2.8

0.7

-0.1

-0.03

-1.9

-0.27

-0.19

-0.15

-0.12

Areas excluding the Seoul metropolitan area 1. Southern Seoul 2. Northern Seoul Source: Korea Appraisal Board

There were 64,804 housing transactions in November, down 30.0 percent from a month earlier (92,566) and down 13.8 percent from a year ago (75,148).

Housing transactions 2016

2017

Annual Annual

Nationwide

(Thousands)

2018 Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

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 0.45 percent month-on-month in October. Land prices rose 0.54 percent in the Seoul metropolitan area which includes Seoul (up 0.69%), Gyeonggi Province (up 0.41%) and Incheon (up 0.42%). Land prices in Seoul metropolitan area (m-o-m, %)

0.36 (Mar 2018) → 0.34 (Apr) → 0.36 (May) → 0.40 (Jun) → 0.46 (Jul) → 0.49 (Aug) → 0.52 (Sep) → 0.54 (Oct)

Land prices also rose in areas excluding the Seoul metropolitan area. Land prices in areas excluding Seoul metropolitan area (m-o-m, %)

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

Land prices

(Percentage change from previous period)

2014

2015

2016

2017

2018

Annual Annual Annual Annual Jan-Nov

Aug

Sep

Oct

Nationwide

1.96

2.40

2.70

3.88

3.80

0.99

1.05

1.25

0.42

0.43

0.45

Seoul

2.66

2.69

2.97

4.32

5.02

1.28

1.09

1.87

0.61

0.68

0.69

Gyeonggi

1.24

1.73

2.23

3.45

3.62

0.83

1.17

1.16

0.41

0.37

0.41

Incheon

1.35

1.95

1.74

3.10

2.84

0.65

0.82

0.94

0.28

0.36

0.42

Source: Korea Appraisal Board

December 2018

There were 282,000 land transactions in October, up 21.8 percent from the previous month (232,000) and up 18.8 percent from a year ago (238,000). Land transactions (m-o-m, %)

Seoul (10.9), Incheon (29.7), Busan (22.4), Gwangju (26.2)

Vacant land transactions increased 33.4 percent from the previous month (66,000 â&#x2020;&#x2019; 89,000) accounting for 31.3 percent of the total land transactions. The index rose 16.4 percent compared with a year ago (76,000).

Land transactions

(Land lots, thousands)

2016

2017

Annual Annual

Nationwide

2018

Nov Dec Jan

Feb Mar Apr May Jun

Jul

Aug Sep

250

276

294

296

298

252

320

265

271

255

272

248

232 282

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 Area excluding Seoul metropolitan are

Oct

0 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 rose 0.4 percent month-on-month in October. Mining & manufacturing (up 1.0%), services (up 0.3%) and public administration (up 1.3%) increased while construction (down 2.2%) declined. Compared to a year ago, industrial output rose 6.7 percent.

Index of all industry production (%) 15

-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 0.2 points month-on-month to 98.4. Four components of the index rose, while the other three fell. Components of the coincident composite index in October (m-o-m)

service output (0.3%), domestic shipments (0.3%), imports (0.2%), nonfarm payroll employment (0.1%), mining & manufacturing production (-0.2%), value of construction completed (-2.2%), retail sales (-0.6%)

The cyclical indicator of the leading composite index fell 0.4 points from the previous month to 98.8. One component of the index rose, while the other seven fell. Components of the leading composite index in October (m-o-m)

inventory circulation indicator (1.0%p), consumer expectations index (-1.1p), domestic shipments of machinery (-1.4%), value of construction orders received (-11.8%), ratio of export to import prices (-0.7%), ratio of job openings to job seekers (-1.0%p), KOSPI (-1.9%), spreads between long and short term interest rates (-0.07%p)

December 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 Mar

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, %)

Apr

May

Jun

Jul

Aug1 Sep1

Oct1

-0.9

1.4

0.3

-0.6

0.7

0.4

-1.2

0.4

-0.6

1.9

1.7

0.2

1.4

1.6

-4.8

6.7

108.8 108.9 109.1 109.2 109.2 109.2 109.2 109.2 0.3

0.1

0.2

0.1

0.0

99.8

99.7

99.6

99.4

99.1

98.9

98.6

98.4

0.0

-0.1

-0.2

-0.3

-0.2

-0.3

-0.2

112.3 112.3 112.8 113.0 113.3 113.2 113.4 113.4 0.2

0.3

-0.1

0.2

0.0

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

99.8

99.4

99.2

98.8

-0.2

-0.4

-0.2

-0.4

1. Preliminary

0.1

0.0

0.4

Policy Issue

2019 economic policies

December 2018

2019 Economic Policies

Background The economy has to deal with challenges posed by the changes in the country’s growth paradigm from a development-focused one to a more inclusive one. Although the administration’s inclusive growth policies, which put their first priority on the wellbeing of Korean citizens, have begun to produce outcomes as household income has increased and the basic cost of living has decreased, problems have also been posed by weakening job markets and shrinking private sector investment. For the 2019 outlook, there are concerns that the country’s major trade partners, such as the US, China and Japan, may see their growth slowing down, leading to a slowdown in the country’s exports. External risks will continue, such as global trade conflicts, monetary policy normalization in major economies and financial market volatility in emerging economies, as well as domestic risks such as large household debt, declining labor force and ageing population. Against this backdrop the government has made the country’s economic outlook for 2019 and drawn up the 2019 economic policies.

Economic Bulletin

Policy Issue

2019 outlook

- ‌ Growth: Annual growth of 2.6~2.7 percent, similar to this year’s, is expected. Exports are projected to grow at a slower rate, and growth will be supported by investment boosting policies and expanded welfare expenditures. - ‌ Employment: A total of 150,000 jobs are expected to be added to the economy, the employment rate improving from 66.7 percent to 66.8 percent. - ‌ Inflation: The annual consumer price inflation is projected to be 1.6 percent, staying stable from the previous year, as oil prices will go down, and fresh food and service prices will become stable. - ‌ Current account balance: Current account surpluses are expected to decline to US $64 billion, as export growth is projected to slow down in line with slowing global trade and ongoing trade conflicts. Exports are projected to grow 3.1 percent, and imports to rise 4.2 percent. 2018

2019

2.6~2.7

Employment growth (thousands)

100

150

Employment rate (%, aged 15-64)

66.7

66.8

Consumer price inflation (%)

1.6

Current account (US $billion)

GDP growth (%)

Framework for the 2019 policies The 2019 policies have been devised, with a long-term goal of inclusive growth in mind, as well as the administration’s three pillars: income-led growth, ‘innovative growth’ (growth led by industrial innovation), and a fair economy (an economy that works for all). The framework for the 2019 policies is as follows:

- Boost the economy - Work on industrial restructuring - Pursue inclusive growth - Address mid- to long-term challenges

2019 economic policies 1. Boost the economy The government will make sure by employing fiscal, financial, regulatory and all other measures available that the economy will regain momentum. - Promote ‌ corporate investment, as well as public sector investment

1) ‌ Work to remove barriers to corporate investment, such as by streamlining complex regulatory procedures and working on agreements among different interests

December 2018

2) ‌ Promote private investment in public projects: more than 6.4 trillion won worth of public infrastructure construction projects to be made available for private investment 3) ‌ Make available financial support worth as much as 16 trillion won to promote corporate investment, including 10 trillion won to support business restructuring and 5 trillion won to support better environment and safety 4) ‌ Increase SME tax incentives for investment: SMEs located in the areas affected by restructuring to receive increased tax incentives, and reshoring companies to receive increased income tax reduction 5) ‌ Increase fiscal investment in infrastructure: Launch as soon as possible large scale infrastructure projects, such as transportation and logistics facilities construction, frontload budgets for community facilities construction, and streamline regulatory procedures for public enterprises and local governments to early start their construction projects

- ‌ Encourage entrepreneurship: Provide appropriate support according to the different stages of business development from starting up to scaling up to business exit and rebound

1) ‌ Start up: Increase the portion of startup financing for government’s venture funds, expand gift tax reduction given to startups, revise the income tax break for startups in a way to promote job creation, and expand R&D tax deduction 2) ‌ Scale up: Promote financing in the market, such as through small-scale public offerings, crowdfunding and business development companies (BDCs), support private sector financing, such as intellectual property (IP)-based lending by establishing an IP value evaluation system and a loan collection system, expand technology-based lending, and raise tech-based funds worth 500 billion won over the next four years 3) ‌ Business exit: Extend the M&A tax reduction given to companies acquiring high-tech SMEs to the end of 2021, and increase the sales tax break given to seller companies if they reinvest in other ventures 4) ‌ Rebound: Increase the grace period of government loans given to those retrying in other fields after failure, and provide special loans and guarantees for those retrying

- Boost consumption and promote tourism

1) ‌ Extend the consumption tax reduction for car purchases until the end of June 2019, as well as the support for scrapping old diesel cars 2) ‌ Develop a tour program which will be comprised of the Korea Sales Festa and K-Pop performances, work on the development of natural resources into tourist attractions, such as national parks for ocean leisure, forests for leisure and rest, old palaces with education programs and an ecology park around the DMZ, work to promote cruise tourism, such as by building infrastructure needed and revising regulations, and allow duty-free shops in downtown Seoul

- Promote exports

1) ‌ Provide a total of 6 trillion won worth of support to promote overseas construction, including plant and smart-city construction 2) Increase export financing by 12 trillion won to 217 trillion won

Economic Bulletin

Policy Issue

3) Promote expanding markets to the ‘New South’ and ‘New North’1) by providing up to 5 trillion won worth of support for M&As with companies located there, as well as building manufacturing facilities and distribution systems in those areas

- Properly manage macro-economy

1) ‌ Strengthen risk management: Frontload in the first half the largest budget ever to respond to weak employment and slowing growth, unfold FX market operation to increase transparency, and work on external risks, including trade conflicts between the US and China, such as by keeping 24/7 monitoring, preparing contingency plans and properly using diplomacy 2) ‌ Properly manage risks which may arise from interest rate hikes: (Household debt) Require banks to reserve additional capital which will match household credits, and tightly regulate nonbank financial institutions’ debt service ratio, (Corporate debt) Increase collateralized bonds issued by public financial institutions, and revise regulations to promote corporate lending by banks

2. Work on industrial restructuring The government will work to help reach a national consensus about new services, and will work to produce outcomes of the labor market reform, as well as industrial reform. - Remove regulatory barriers to new services

1) Make home sharing services available to locals in addition to foreign tourists 2) Work to introduce remote patient monitoring via smartphones, and announce a guide to healthcare services provided by non medical institutions 3) Run a pilot program for car sharing

- Strengthen major industries

1) ‌ Draw up measures to innovate the country’s major manufacturing with support focused on cars, vessels, display panels and petrochemicals: Provide auto part suppliers with the support needed when they issue bonds, and work on the development of future car technology, including those for driverless cars and electric cars 2) ‌ Revise the Corporate Restructuring Promotion Act to provide support in advance to companies wanting to avoid restructuring, extend the Corporate Restructuring Promotion Act until August 2024, and increase the corporate restructuring fund if necessary by 0.5 trillion won to 1.5 trillion won

- Increase support for new industries

1) ‌ Provide across-the-board support from fiscal to tax and regulatory support to promote smart factories, future cars, fintech and biohealth: Announce in the first quarter of 2019 plans to grow smart car industries, allow online payment services provided by the country’s nonbank financial institutions for overseas purchases, and give biohealth companies the new growth engine R&D tax deduction for their overseas clinical trials

1) Southeast Asian countries and countries in central Asia

December 2018

2) ‌ Work to develop new business models: Promote new services which use state-of-the-art technologies of AI, IoT and robots, and seek private-public cooperation in building a platform economy for such industries as biohealth, future cars, energy and high-tech materials

- ‌ Develop service industries: Work on the passage of the Framework Bill for Services Development in the first quarter of 2019, draw up measures in the first half to innovate promising services, such as tourism, healthcare, contents and logistics, continue to grow services which create more jobs, such as tourism, healthcare, education, SW and games, and promote jobs in new areas, such as green care specialists, by issuing professional certificates, as well as providing other regulatory support - ‌ Work to develop a model for sustainable employment: Promote ‘equal pay for equal work,’ work to develop an employment model beneficial to both industries and workers, and work to increase welfare for SME workers and give 10 percent tax deduction to large conglomerates for their funding to SME welfare funds

3. Work on inclusive growth The government will continue to work to help increase household income and expand social safety nets, while making up for shortcomings in some measures. - ‌ Increase support for the working class and the self-employed: Carry out measures to reduce the operational burden of small businesses, as well as to protect them, such as by introducing a new online payment service with extremely low fees and adopting a 10 year guarantee of commercial lease extension, set aside businesses only for SMEs and small merchants, and provide financial support for heavily indebted small merchants, as well as for those retrying after failure - Support the vulnerable

1) ‌ Provide employment as well as wage support: (Young adults) Strengthen education support and scholarship programs for those from low income families, as well as set aside quotas in medical schools and law schools, double the support for hiring young adults, and work to increase public sector jobs for high school graduates, (Women) Add as many as 18,000 caring jobs, increase support for hiring female workers with flexible work schedules, and expand SME tax support for hiring women wanting to work again, (Middle aged) Create 2,500 jobs which require skills and experience of the middle-aged, and increase employment support for the middle-aged from 3,000 employees to 5,000, (Elderly) Increase public sector jobs for the elderly by 100,000 to 610,000 2) ‌ Make up for shortcomings in the minimum wage increase and up to 52 work hours per week: Increase financial as well as tax support for small business owners, improve the current minimum wage system, and make up for the shortcomings in the up to 52 hour workweek 3) ‌ Promote social enterprises: Increase the wage support given to social enterprises for hiring young adults, help social enterprises expand their markets, and draw up a framework bill for developing social enterprises

Economic Bulletin

Policy Issue

- ‌ Work to improve the quality of living: Work to increase rental homes, invest 3 trillion won to build a high speed railway running across the Seoul metropolitan area, expand the coverage of national health insurance, increase college tuition support, and work to help reduce fine dust, such as by increasing electric buses and providing support for street washer trucks - ‌ Strengthen social safety nets: Expand the EITC, work to introduce an unemployment support to help those not covered by national unemployment insurance, expand the coverage of social security benefits, daycare benefits, pension benefits and housing benefits, increase unemployment benefits, and work to revise the national pension plan - ‌ Promote fair economy: Work to get rid of unfair practices, including those related to internal transactions and price fixing, require large manufacturers to publicize information on their payment to first-tier suppliers so that second-tier suppliers can refer to it, impose heavier punishment on stealing technology from SMEs, work to improve corporate governance and increase corporate management transparency, and promote cooperation between large conglomerates and SMEs

4. Prepare for the future The government will work to prepare for changes in the future, such as those the fourth industrial revolution and the low birth and ageing society will bring, as well as to prepare for economic cooperation with the North. - ‌ Prepare for the fourth industrial revolution: Promote investment in R&D, restructure R&D support and launch R&D funds, work on developing a platform economy and promote industrial convergence, develop workforce by strengthening school education as well as job training for college graduates, and expand occupational training programs for low-skilled workforce - ‌ Prepare for low birth and ageing population: Revise the government’s mid- to long-term plans according to demographic changes in the future, increase maternity benefits, increase wage support for moms working part-time and promote the opening of daycare centers in work places, introduce paternity benefits and raise the level of the pay dads can receive during the paternity leave - ‌ Prepare for economic cooperation with the North: Work to make plans ready for effective economic cooperation to be possible when situations improve, which include working with international organizations

16 most important tasks The government will work for the following tasks to start producing outcomes in the first half of 2019. - Work for investment in large-scale projects to be made as early as possible

1) ‌ Work for more than 6 trillion won worth of corporate construction projects to start as early as possible

December 2018

2) ‌ Attract private sector capital to public infrastructure projects worth more than 6.4 trillion won 3) ‌ Work to start as early as possible the construction of community facilities, worth 8.6 trillion won 4) ‌ Frontload 61 percent of budgets in the first half, and increase investment by public institutions

- Help reach an agreement on tasks suspended due to different interests

1) Work to find ways to a sharing economy 2) ‌ Work to introduce remote-healthcare and healthcare services provided by nonmedical institutions 3) Develop employment models more beneficial to both industries and workers 4) Promote ‘equal pay for equal work’

- Work on industrial innovation

1) ‌ Draw up measures to strengthen major industries, such as cars, vessels, display panels and petrochemicals 2) ‌ Draw up measures to develop promising services, such as tourism, healthcare, contents and logistics 3) ‌ Work to establish a healthy ecosystem for ventures by providing proper support according to different business stages of start up, scale-up, business exit and rebound 4) ‌ Draw up support for the four new industries: Smart factories, future cars, fintech and biohealth

- Continue with inclusive growth policies, making up for shortcomings

1) ‌ Strengthen support for young adults from low income families, such as by strengthening scholarship programs, setting aside quotas in medical schools and law schools, and increasing other education support 2) ‌ Work to increase the income of the working class households, including the self-employed, such as through increased EITC, low-fee online payment systems, and increased protection for business tenants 3) ‌ Work to introduce an unemployment support to cover those outside of national unemployment insurance 4) ‌ Revise the Minimum Wage Act and Labor Standards Act to make up for the shortcomings in the minimum wage increase and up to 52 hour work week

Economic News Briefing

BOK lifts interest rate to 1.75% Korea issues this year's fourth 50-yr KTBs Korean FDI posts US $13.11 billion in Q3 2018 Korea grows 0.6% in Q3 2018 (preliminary)

December 2018

BOK lifts interest rate to 1.75% The Bank of Korea (BOK) raised its benchmark interest rate by 25 basis points to 1.75 percent on November 30 for the first time since November last year. The BOK stated that the economy has been growing at its potential growth rate, strong consumption and exports being offset by weak investment in facilities and construction. The central bank said that whether it will maintain accommodative policies or not will depend on future developments in the economy, including inflation trends.

Korea issues this year's fourth 50-yr KTBs The Ministry of Economy and Finance (MOEF) issued 600 billion won worth of 50-year Korea Treasury Bonds (KTBs) on December 7, which marks the fourth issuance of the kind in 2018. Investors placed orders worth 650 billion won for the ultra-long bonds, and the range of bids received was 1.500 percent to 2.100 percent. The amount accepted was 600 billion won, the rate being accepted at 1.950 percent.

Korean FDI posts US $13.11 billion in Q3 2018 Korean foreign direct investment (FDI) for the third quarter of 2018 posted US $13.11 billion, rising 33.0 percent from US $9.86 billion a year ago and falling 0.4 percent from US $13.17 billion in the previous quarter. As of September, Korean FDI has amounted to US $36.02 billion this year, rising 7.3 percent compared with US $33.56 billion for the same period of the previous year. By industry, Korean FDI focused on manufacturing (38.4%), financial & insurance services (29.6%), real estate & renting (11.6%), information & communications services (4.2%) and wholesale & retail (3.3%). By region, FDI concentrated on Asia (33.7%), North America (29.1%), Europe (25.2%), Latin America (8.6%) and the Middle East (1.9%).

Economic Bulletin

Economic News Briefing

Korea grows 0.6% in Q3 2018 (preliminary) Koreaâ&#x20AC;&#x2122;s real gross domestic product (GDP) expanded 0.6 percent quarter-onquarter and 2.0 percent year-on-year in the third quarter of 2018, according to the preliminary data released by the Bank of Korea (BOK) on December 4. On the production side, agriculture, forestry & fisheries contracted 5.5 percent compared to the previous quarter. Manufacturing grew 2.3 percent backed by strong semiconductors, and construction decreased 5.7 percent as both building construction and civil engineering works declined. Services grew 0.5 percent due to strong healthcare & social welfare services. On the expenditure side, private consumption increased 0.5 percent backed by strong sales of nondurable and semi-durable goods, while government consumption rose 1.5 percent as expenditures on health care benefits increased. Construction investment contracted 6.7 percent as building construction and civil engineering works both fell, and facility investment declined 4.4 percent due to weak machinery. Intellectual property investment rose 0.9 percent. Exports increased 3.9 percent as semiconductors continued to be strong, and imports decreased 0.7 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 0.6 1.0 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

-5.5

Manufacturing

0.0

1.3

-0.1

1.8

1.7

0.1

2.7

-1.7

1.6

0.6

2.3

Construction

3.7

2.0

2.3

2.2

4.8

-1.6

1.0

-1.6

2.1

-3.1

-5.7

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

0.5

Government consumption

1.7

0.6

0.7

0.5

0.6

1.2

1.9

0.5

2.2

0.3

1.5

Construction investment

5.6

3.2

2.2

1.0

4.2

0.9

1.1

-2.3

1.8

-2.1

-6.7

Facility investment

-7.1

2.7

1.6

6.5

4.5

4.3

0.2

-0.7

3.4

-5.7

-4.4

Intellectual property investment

0.9

1.5

0.7

0.3

0.5

1.5

1.1

0.3

-0.7

0.9

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

-0.7

*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 -2.4

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 3.0

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 2.5

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 -6.6

-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 -8.9

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 -7.4

December 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 8 9p 10p

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 99.7 109.6

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 10.7

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 99.7 98.2 106.7

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 1.1 -8.7 10.8

* 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 97.8 101.2 103.6 103.5 106.4 111.8 112.1 108.9 105.4 106.2 107.1 105.7 105.6 103.5 105.2 102.6 101.0 100.8 101.3 97.8 101.6 101.7 101.2 103.7 107.1 103.6 106.9 107.0 103.5 107.3 106.3 106.4 110.9 110.7 111.8 113.5 112.9 112.1 111.6 111.8 108.9 110.1

-1.6 8.8 10.5 3.4 -1.2 -1.6 -5.5 0.1 2.5 8.8 10.5 8.2 5.2 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 4.5 5.2 2.6

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 99.3 108.1 105.9 106.9 107.8 105.8 105.6 105.9 107.6

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 1.6 -1.5 5.4

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 8 9p 10p

Production capacity index* (2010=100)

Operation ratio index* (2010=100)

y-o-y change (%)

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

* 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 -1.8

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 93.7 104.1

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 -8.0 13.2

72.9 72.6 73.4 72.8 72.1 73.5 73.5 72.0 73.0 71.8 71.0 73.2 74.2 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 73.8 74.0

December 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 8 9p 10p p: Preliminary Source: Statistics Korea

y-o-y change (%)

103.9 105.9 99.9 104.3 101.7 109.6 101.5 105.3 105.0 111.9 106.6 110.2 109.0 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 95.4 105.5 104.0 107.7 104.2 104.7 101.0 109.3 107.9 114.9 112.8 105.2 101.6 112.9 109.6 112.5 108.4 110.5 106.8 109.7 113.3

3.9 1.9 4.7 5.6 3.1 2.2 1.6 1.0 3.2 2.1 5.0 4.7 3.8 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 5.7 0.4 5.0

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

104.6 110.2 99.4 108.8 99.2 111.2 102.8 112.9 111.1 113.8 111.8 119.3 113.6 92.9 92.8 112.5 103.3 108.4 114.7 103.5 100.9 93.2 107.3 110.6 115.6 94.7 100.0 113.7 108.5 114.2 115.9 115.0 107.0 111.4 104.0 122.8 114.6 110.0 101.3 124.2 119.5 120.4 117.9 122.0 117.5 101.2 116.8

4.6 5.4 6.7 11.5 0.8 0.3 3.4 3.8 12.0 2.3 8.8 5.7 2.3 -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 9.8 -9.2 12.3

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 98.1 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 89.1 106.3 122.8

2.3 -1.1 2.0 4.2 3.3 0.1 -1.8 -2.3 -0.8 0.6 4.8 5.9 8.0 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 6.8 9.0 8.0

Nondurable goods

y-o-y change (%)

104.2 106.0 101.7 102.5 107.4 105.2 103.9 103.6 108.4 108.1 107.4 107.3 111.7 103.7 99.7 101.6 100.3 105.4 101.9 105.0 107.7 109.4 104.6 103.7 107.4 110.9 96.4 104.4 101.2 105.8 103.8 105.7 106.0 113.5 107.2 107.0 110.1 107.7 106.1 108.4 105.8 109.0 107.2 110.3 109.6 115.1 107.5

4.2 1.7 5.0 3.3 4.2 4.3 2.2 1.1 0.9 2.8 3.4 3.6 3.0 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 3.4 1.4 0.3

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 8 9p 10p

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 7,560 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 2,520 2,393 2,531

4.7 19.2 -0.9 -1.3 4.8 16.7 21.1 23.7 31.3 4.2 4.4 -0.4 -0.1 -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 6.9 -0.8 7.6

y-o-y change (%)

2,862 2,239 637 575 465 1,184 691 542 461 545 603 645 497 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 67 324 106 229

49.0 -21.8 57.4 16.8 16.6 89.9 8.4 -5.8 -0.9 -54.0 -12.7 18.9 7.7 -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 -77.4 297.8 26.0 37.1

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 7,063 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 2,196 2,287 2,302

1.1 24.1 -4.8 -2.6 3.9 8.8 22.5 26.3 34.1 15.0 6.1 -1.7 -0.6 -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 -3.5 -1.8 5.4

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

change (%)

110.7 126.3 100.1 114.2 106.3 122.0 118.3 134.5 128.2 124.4 129.4 126.6 110.8 97.0 90.7 112.7 111.0 110.6 121.1 105.0 109.8 104.0 109.3 118.8 138.0 107.0 108.5 139.3 127.0 132.8 143.7 131.1 123.5 130.0 105.0 126.8 141.4 130.0 118.8 139.4 129.0 128.2 122.6 117.8 109.5 105.2 114.9

-1.3 14.1 -7.6 0.6 -4.7 5.9 18.2 17.8 20.6 2.0 9.4 -5.9 -13.6 -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 -19.1 9.4

December 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 8 9p 10p

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 32,792 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 10,923 10,872 10,844

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 -5.9 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 -1.6 -13.3 0.1

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 6,323 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 1,951 2,242 2,075

-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 -6.0 -12.9 -4.6

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 25,576 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 8,677 8,391 8,469

24.2 25.1 14.0 24.6 23.7 32.2 36.9 29.7 27.7 11.6 10.4 3.1 -5.6 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 -1.2 -12.7 0.7

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 31,128 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 9,251 11,266 9,298

8.1 -3.1 13.6 -7.3 0.6 26.4 1.2 17.9 -10.2 -15.0 2.3 -15.7 -5.6 -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 -27.4 -4.1 12.6

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 6,294 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 2,213 2,460 1,706

18.5 -1.1 68.6 -37.9 61.5 24.9 -6.0 35.5 -11.7 -7.5 -33.9 -16.5 -9.9 102.9 106.4 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 -27.0 14.7 88.4

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 23,479 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 5,877 8,681 7,515

4.4 -5.0 -0.6 3.1 -12.6 30.1 -12.4 13.8 -4.3 -16.1 16.1 -16.0 -9.1 -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 -39.4 -8.5 2.5

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 7 8p 9p 10p 11 12

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

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 98.8 -

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

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 98.4 -

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 96.0 -

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 74 -

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 74

December 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 11

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 99.9 100.2 100.4 100.8 100.6 100.8 100.8 100.8 100.6 100.9 101.5 101.6 101.5 101.6 102.4 102.8 102.8 102.7 102.8 102.7 102.9 103.5 103.6 103.4 102.7 103.0 103.5 104.3 104.2 104.3 104.4 104.2 104.4 104.9 105.6 105.4 104.7

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 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 98.5 100.0 100.3 100.1 100.1 101.1 101.6 101.5 100.8 101.0 100.9 100.8 102.0 102.5 101.8 100.6 101.1 101.5 102.7 102.3 102.4 102.5 102.3 102.4 103.4 105.1 104.6 103.2

-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 2.6

Core

y-o-y change (%)

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

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 1.5

y-o-y change (%)

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

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 1.3

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 99.5 100.0 100.9 102.3 102.7 102.7 102.4 102.2 101.8 101.9 102.3 103.0 103.1 103.0 103.1 103.6 104.0 104.0 104.2 100.4 104.5 104.9 105.5 105.8 105.4 104.7

-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 1.6

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 99.9 100.5 100.5 100.6 100.9 101.1 101.6 102.3 102.8 102.2 101.1

-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 1.7

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 11

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 28,092

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 86 136 137 143 203

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 16,192

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 41

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 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 61.4

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 3.2

December 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 11

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 27,184

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 64 165

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 4,490

-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 -91

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 21,241

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 60 179

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 10 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 9,190.3

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 10,997.0

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 57,237.4

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 46,240.4

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 -2,221.6

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 51.1 667.3 957.4

-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 -542.5

December 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 10

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 10,587.7

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 3,363.3

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 6,748.2

-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 1,091.4 761.9 442.7 767.2

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 -2,448.6

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 2,157.6

* 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 82.8

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 11 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 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 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 1.9

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 2.0

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 2.4

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 2,096.86

December 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 10

y-o-y change (%)

120,691.4 137,441.5 151,858.1 113,304.2 116,502.4 115,974.9 115,132.7 117,726.3 118,688.2 122,041.0 121,854.4 126,572.2 125,616.2 126,767.1 128,117.5 131,279.3 134,913.0 132,957.9 135,038.9 135,971.3 135,758.4 135,906.7 139,073.9 142,079.6 141,103.5 141,757.2 143,458.7 147,380.8 150,092.9 145,049.0 149,630.1 149,446.2 150,519.7 149,955.1 152,170.5 154,578.6 159,248.2 155,623.3 158,603.1 157,220.1 163,852.7 160,760.7 161,527.1 160,475.5 164,397.3 163,223.4 165,629.2 170,529.6 170,478.9

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 7.1

M2 y-o-y change (%)

636,639.0 734,411.8 802,016.5 579,964.2 592,737.4 600,719.9 610,803.3 621,985.5 630,546.3 645,975.4 653,105.9 665,691.1 669,737.7 677,629.2 690,772.4 699,767.3 708,014.0 713,861.2 720,818.5 722,544.4 730,637.8 735,172.2 738,120.9 751,408.5 753,367.3 762,639.7 776,589.6 780,995.5 776,362.5 789,187.8 791,859.3 791,074.8 798,890.2 804,853.4 805,103.3 810,905.0 826,892.1 817,624.5 830,003.7 830,732.8 839,555.2 840,991.0 841,002.2 839,880.5 846,240.2 843,752.8 837,607.5 845,523.7 840,678.4

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 1.7

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 2,674,506.5

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 6.8

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 3,759,599.6

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 7.4

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 11 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 1,121.8

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 3.6

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 1,008.9 989.0

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 2.3

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 1,277.7

-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 -0.4

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

December 2018

ECONOMIC BULLETIN (Republic of Korea)

For free subscriptions and enquiries, please contact: International Media Relations Division Ministry of Economy and Finance Government Complex, 477 Galmae-ro Sejong, 30109 Republic of Korea Tel. +82 2 731 1530 Fax. +82 2 731 1540 E-mail. fppr@moef.go.kr Website. http://english.moef.go.kr Economic Information and Education Center Korea Development Institute 263 Namsejong-ro Sejong, 30149 Republic of Korea Tel. +82 44 550 4645 Fax. +82 44 550 4941 E-mail. jiyounlee@kdi.re.kr Website. http://eb.kdi.re.kr