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Business sentiment for May pessimistic over Middle East tensions: poll

April 24, 2024

South Korea’s business sentiment index remained pessimistic for May due to uncertainties caused by fresh tensions in the Middle East and persistent inflationary pressure, a poll showed Wednesday.

The business survey index (BSI) for the country’s top 600 companies by sales stood at 94.9 for next month, down 3.7 points from April, according to the monthly poll by the Federation of Korean Industries (FKI).

A reading below 100 means pessimists outnumber optimists, while a figure above the benchmark means the opposite. The index has remained below 100 since April 2022.

The BSI for the manufacturing industry came to 95.5 for May, with the index for the nonmanufacturing sector reaching 94.1. The index for manufacturers has fallen for two consecutive months and that for nonmanufacturing firms has declined for five straight months.

A FKI official said companies are faced with difficulties due to persistently high interest rates, inflation and exchange rates, along with deteriorating situations in the Middle East, and stressed the need to strengthen preparations against external risks.

The entrance of the Federation of Korean Industries in Seoul (Yonhap)
The entrance of the Federation of Korean Industries in Seoul (Yonhap)