South Korea's October business confidence climbs to highest level in over four years

A survey released by the Bank of Korea on Thursday showed that business confidence in South Korea rose to a more than four-year high in October, driven by firm manufacturing sentiment and an improved outlook in the non-manufacturing sector.

According to Bank of Korea data, the Composite Business Sentiment Index (CBSI) for all industries stood at 104.2 in October, up 5.1 points from the previous month.

This reading marked the highest level since August 2022, when the index recorded 105.5 in the aftermath of the COVID-19 pandemic.

The index measures businesses' expectations for the overall business environment; a reading below 100 indicates that more companies are pessimistic than optimistic.

An official from the Bank of Korea said: "Increased investment and production in key industries such as semiconductors, automobiles, and shipbuilding have driven growth in related upstream industries. In addition, the stronger South Korean won has helped domestic companies ease the financial burden of procuring imported raw materials."

In October, the manufacturing CBSI rose 6.1 points month-on-month to 105.6, hitting a more than four-year high; the previous peak occurred in June 2022, when the reading was 107.1.

The non-manufacturing CBSI rose 4.3 points month-on-month to 103.2, the highest level since September 2022.

The survey showed that the expectations index for November rose 2.2 points from 99.6 points the previous month to 101.8 points.

The Economic Sentiment Index (ESI) for October — which reflects the overall mood of consumers and businesses — rose 0.9 points to 100.8 points.

Element Solutions (ESI) was referenced in the original data.