Home > Monthly BSI
2017. 1. BSI - BSI for January
Fiscal&Financial Policy Team
2016-12-29
<BSI for January>

BSI for January dips under 90


   The Business Survey Index (BSI), a survey of the nation's top 600 companies in terms of sales conducted by the Federation of Korean Industries (FKI), slid to 89.9 for January, staying below par for eight months in a row. A BSI reading below the break-even 100 level indicates companies are delivering a gloomy prediction of their business. The figure for January marks the longest period of hovering below par since the European financial crisis early in 2012 and 2013. Their pessimism stems from lingering uncertainties at home and abroad.

< Comprehensive BSI by Month >

 
'16.1
2
3
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5
6
7
8
9
10
11
12
'17.1
General Business
(Prospects)
93.2
86.3
98.3
95.7
102.3
94.8
90.5
89.5
95.0
96.0
89.8
91.7
89.9
General Business
(Performance)
92.1
87.0
94.2
97.3
97.1
91.3
89.7
90.0
92.0
89.0
91.0
91.1
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   The outlook for January next yeat again fell down below 90 after the index for December rebounded to 91.7 from 89.8 for the previous month. The major concern in the business community is mounting precariousness in society which is driving its business directivity in a state of entropy. On top of this, the economy is faced with unfavorable external factors like the rate hike in the U.S. which is placing household debts in jeopardy. Moreover, export could be affected by China's entering an era of the so-called "New Normal" with a medium growth pace of six percent. Much worse, businesses can hardly expect special demands from new year holidays in Korea and China which fall at the end of January, 2017. The December index for business performances also came in at 91.1, making the reading hover below the break-even 100 mark for as long as 20 consecutive months since May, 2015.

   "It appears hard to regain corporate confidence for the time being as more research institutes here are joining in lowering their outlook for growth next year," an FKI official worried, adding, "We need to be determined to fight an uphill battle and prevail against all odds after all, falling back on the lessons we had learned from overcoming the crises in the past,"