Seoul: South Korea's business sentiment improved for the second straight month in April, though it remained subdued amid uncertainties at home and abroad, a central bank poll showed Thursday. The Composite Business Sentiment Index (CBSI) for all industries rose to 87.9 in April, a 1.2-point increase from the previous month, according to the survey by the Bank of Korea (BOK).
According to Yonhap News Agency, this marks the second consecutive monthly increase, although the index has stayed below the long-term average of about 90 since November. Business sentiment had hit the lowest level in about 4 1/2 years in February, largely due to Yoon's declaration of martial law and uncertainties triggered by U.S. President Donald Trump's new tariff scheme.
The improvement in sentiment came after the Constitutional Court upheld Yoon's impeachment on April 4, formally removing him from office. The index measures corporate prospects for business conditions, and a reading below 100 indicates that pessimists outnumber optimists. The CBSI among manufacturers climbed 1.2 points to 93.1 in April, while nonmanufacturers saw an increase of 1.6 points to 84.5.
The outlook for May also improved, adding 0.7 points to reach 86.3, as reported by the survey. "Manufacturers pointed to uncertain economic circumstances as key concerns for their businesses, followed by weak domestic demand and the wobbly currency. Nonmanufacturing firms also cited economic uncertainties, labor shortages, and rising labor costs as key concerns," a BOK official stated.
The economic sentiment index (ESI), which reflects sentiment among both consumers and businesses, edged up 0.2 points to 87.4 for April. The survey, conducted earlier this month, involved 3,282 companies, including 1,847 manufacturing firms, according to the BOK.
South Korea is preparing for the impact of the Donald Trump administration's sweeping tariff scheme on its industries and export-driven economy. Top economic and trade officials from South Korea and the United States are scheduled to hold tariff talks in Washington on Thursday (U.S. time), following the Trump administration's announcement of a 90-day pause on the 25 percent reciprocal tariffs on South Korean imports.