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South Korea April manufacturing activity contracts further, PMI falls to 6-mth low
[SEOUL] South Korea's manufacturing activity and new export orders both contracted for a second month in April, putting the economy's already sluggish recovery at further risk, a private sector survey showed on Monday.
The HSBC/Markit purchasing managers' index (PMI) on South Korea's manufacturing sector fell to a seasonally adjusted 48.8 in April, its lowest since October last year, data from Markit Economics showed.
The reading marked a sharper contraction than the 49.2 recorded in March. A level below 50 indicates activity during the month contracted from the previous month.
A sub-index on new export orders received by manufacturers in South Korea fell to 47.6, also the lowest in six months.
Policymakers have said in recent weeks there are positive signs of growth in South Korea, led by private consumption, and expect momentum to pick up in the second quarter.
South Korea's economy is however, export-led and shipments this year have been weak as economies in China and Europe struggle with their own growth troubles.
Exports in April suffered their sharpest fall in two years and their fourth straight monthly decline on lower oil prices and weak global demand, data showed on Friday, underscoring the need for more stimulus measures.
The Bank of Korea surprisingly cut the policy interest rate by 25 basis points to a record low of 1.75 per cent in March. It kept rates unchanged in April and will next meet on May 15.