The government continued its positive assessment of the Korean economy, saying, “A solid economic recovery trend continues.”
However, concerns were expressed that uncertainty related to the Middle East war and the United States' tariff imposition measures had increased compared to last month.
In the September issue of 'Recent Economic Trends' (Green Book) published on the 11th, the Ministry of Finance and Economy assessed, "Recently, our economy continues to show a solid economic recovery trend, with exports increasing significantly and domestic demand, including consumption, showing signs of improvement."
The August issue's judgment that 'the economic recovery trend appears to be strengthening' has been somewhat revised.
An official from the Ministry of Finance and Economy explained, "With fast and strong growth momentum, our economy appears to be taking a step forward and settling down to some extent. We have revised our assessment in that unless external variables take a turn for the worst, the solid growth trend is likely to continue until next year."
All industrial production in July was at the same level as the previous month.
It decreased in the service industry (-1.3% compared to the previous month, 3.5% compared to the previous year) and construction industry (-1.1% compared to the previous month, -3.2% compared to the previous year), but increased in the mining industry (0.2% compared to the previous month, 3.6% compared to the previous year).
According to the service industry's breaking news index for August, online sales increased by 12.9% compared to a year ago.
However, the average daily stock trading value was 31.8 trillion won, lower than July (43 trillion won). Vehicle fuel sales also decreased by 14.3%, the largest decline since April (-22.0%).
Looking at the spending sector, retail sales (-2.4% compared to the previous month, -0.8% compared to the previous year) decreased, but facility investment (7.5% compared to the previous month, 24.9% compared to the previous year) increased.
According to the August retail sales report, the domestic card approval amount increased by 4.9% compared to a year ago. The growth rate increased from July (3.7%).
However, domestic sales of domestic passenger cars decreased by 28.3%. This is the largest decrease since -33.3% in September 2021.
An official from the Ministry of Finance and Economy said, "Since the strike in July and August ended with a decrease in monthly production of 30,000 to 40,000 units, it will recover immediately starting in September. Since monthly indicators fluctuate significantly due to fires, strikes, etc., it is better to judge the economy by looking at trends."
Exports in August increased 68.7% from a year ago due to increased exports of semiconductors, computers, and cosmetics.
The August consumer sentiment index recorded 104.5, down 2.3 points (p) from the previous month.
The number of employed people increased by 184,000 in August, expanding the rate of increase.
In the same month, the consumer price index rose 3.1%, a larger increase than in July (2.8%).
In the financial market in August, stock prices rose, the won/dollar exchange rate fell, and government bond interest rates rose.
The housing market was on the rise in July. The sales price rose 0.35% compared to the previous month, a larger increase than in June (0.33%). The jeonse price rose 0.38%, showing the same increase rate as in June.
Regarding external conditions, the government judged that "the global economy is continuing to grow moderately, but uncertainty related to the Middle East war and U.S. tariff imposition measures has increased somewhat." The external risk alert level was raised from the August issue, which said 'uncertainty always exists'.
The government continued by saying, “The burden on people’s livelihoods continues, including rising inflation pressure due to high oil prices and difficult employment conditions for vulnerable groups and sectors.”
He also announced, "To minimize the impact of the war in the Middle East, we will make every effort to manage the supply and demand of major items and proceed without a hitch with the major policy tasks of the Chuseok people's livelihood stabilization measures, such as price stabilization of sacred items."
Regarding the mid- to long-term response, he said, "We will speedily pursue an economic growth strategy in the second half of 2026 to respond to structural problems such as a post-Middle East war strategy, a rebound in potential growth rate, and polarization."
An official from the Ministry of Finance and Economy said, "With all three international oil prices hitting $100, the pressure to increase global inflation, international oil prices, and the volatility of the international financial market have been growing slightly more recently. We are evaluating the external sector as a factor that needs to be watched with more caution."
He continued, “Because petroleum products have a maximum price system, the primary shock will not have a significant impact,” and predicted, “As long as there are no major changes, we expect to achieve an annual consumer price increase of 2.7%.”
