The S&P Global's seasonally adjusted purchasing managers' index (PMI) for South Korean manufacturers stood at 48.5 in January, unchanged from December and remaining below the 50-mark since July, 2022. The 50-level separates expansion from contraction.
Sub-indexes showed output fell for a tenth month but at a slightly milder pace than a month before, while new orders shrank for an eighth month, with its pace also easing. New orders for exports fell for a 12th month, though the downturn eased from the previous two months.
"PMI survey data for February continued to depict subdued
operating conditions in the South Korean manufacturing sector,"
said Usamah Bhatti, economist at S&P Global Market Intelligence.
"On a more positive note, South Korean goods producers
signalled softer albeit still sharp rises in prices midway
through the first quarter."
Soft domestic and global economic conditions and
inflationary pressures, often caused by exchange rate weakness,
were linked to subdued overall demand, according to the survey.
Currency weakness was cited as a key driving force behind the
latest drop in demand from overseas.
Reflecting weak demand, backlogs of work fell at the
sharpest pace since July 2020, and stocks of finished goods
jumped by the most since November 2007.
The input price inflation softened for a fourth month to the
weakest level since November 2020. However, the rise in
operating expenses remained sharp overall, largely pressured by
a weak exchange rate and rising raw material prices.
At the same time, the rate of output price inflation also
softened, with the latest increase the second-weakest in 27
months.
Manufacturers' optimism about the future output over the
coming year rose for a second month to the highest level in five
months, helped by hopes of a domestic and global economic
recovery.
(Reporting by Jihoon Lee
Editing by Shri Navaratnam)
