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Benchmark Revisions - September 2005

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Released: Tuesday, April 11, 2006

The Conference Board announced today that the leading index for Korea increased 1.4 percent, while the coincident index declined 0.3 percent in February.

  • The leading index increased sharply in February, and it has been increasing steadily in the last five consecutive months. Letter of credit arrivals and exports FOB continued to be the main contributors to the increases in the leading index in recent months. With February's gain, the leading index has been growing at about a 6.0 - 7.0 percent annual rate in recent months, and the strengths among the leading indicators have continued to be widespread.
  • The coincident index fell in February, but it is still on a slightly rising trend despite short term fluctuations. At the same time, real GDP grew at a 6.7 percent average annual rate in the second half of 2005, up from the 4.0 percent average rate in the first half of the year. The continued widespread strength in the leading index suggests that strong economic growth is likely to continue in the near term.

LEADING INDICATORS. Four of the seven components that make up the leading index increased in February. The positive contributors - from the largest positive contributor to the smallest - were letter of credit arrivals, real exports FOB, value of machinery orders, and the (inverted) yield of government public bonds. Stock prices and private construction orders declined, while the (inverted) index of inventories to shipment was unchanged in February.

With the 1.4 percent increase in February, the leading index now stands at 153.2 (1990=100). Based on revised data, this index increased 0.8 percent in January and increased 0.9 percent in December. During the six-month span through February, the leading index increased 4.1 percent, with five of the seven components advancing (diffusion index, six-month span equals 66.7 percent).

COINCIDENT INDICATORS. Only one of the four components that make up the coincident index increased in February. Monthly cash earnings increased, while industrial production and total employment declined. The wholesale and retail sales component remained unchanged in February.

With the 0.3 percent decrease in February, the coincident index now stands at 162.0 (1990=100). Based on revised data, this index increased 0.5 percent in January and decreased 0.2 percent in December. During the six-month span through February, the coincident index increased 1.4 percent, with three of the four components advancing (diffusion index, six-month span equals 75.0 percent).

DATA AVAILABILITY. The data series used to compute the two composite indexes reported in this release are those available "as of" 10 A.M. (ET) on April 10, 2006.

* The series in the coincident index based on The Conference Board's estimates is monthly cash earnings. There is no forecasted series in the leading index.

THESE DATA ARE FOR ANALYSIS PURPOSES ONLY. NOT FOR REDISTRIBUTION, PUBLISHING, DATABASING, OR PUBLIC POSTING WITHOUT EXPRESS WRITTEN PERMISSION.

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