With the COVID-19 epidemic reducing in South Korea, could one of Asia’s worst-performing currencies turn everything around in the final quarter of 2020?
Industrial output dropped 0.7% in August, down from the 1.9% rise in July. The yearly rate dropped 3%, more severe than the market estimate of 2.8%. Manufacturing production also decreased by 3.1% in August, down from the prior month’s 2.2% drop.
Construction output fell at 9.4% year-over-year
Retail sales did shock market observers, climbing 3% in August, up from the 6% decrease in July.
The Bank of Korea’s Business Survey Index increased slightly month-to-month, growing from 66 in July to 68 in August. This was the most extensive reading since January, and it served the fourth consecutive monthly gain. It should be remarked that business circumstances at non-manufacturing businesses dropped from 66 to 62.
This week, trade data and the manufacturing purchasing managers’ index (PMI) will be published for September. Analysts project a 2% gain in exports and a 4.9% drop in imports. They are also expecting the PMI reading to stay in recession territory.
After some fear that South Korea would revert to another lockdown among rising coronavirus cases, the nation flattened the curve once again. The number of new infections has dwindled to double digits, leading the total to more than 23,000.
The benchmark KOSPI Composite Index has lost to gain much traction over the previous month, falling close to 1% in September. It did end yesterday’s trading session up 0.86% to complete at 2,327.89.
The South Korean bond market was diverse. The benchmark ten-year yield bound up 0.4 basis point to 1.43%, the two-year bond slid 0.8 basis point to 0.792%, and the ultra-long 50-year bond fell 0.7 basis point to 1.605%.
The USD/KRW currency pair was maintained at 1,167.37 at 14:06 GMT yesterday. The EUR/KRW rose 0.57% to 1,369.80, from an start of 1,361.77.