South Korea: Improving economic sentiment – Standard Chartered

Chong Hoon Park, Head, Korea Economic Research at Standard Chartered Bank, points out that most of the economists they spoke to expect a better 2020 than 2019 for Korea’s economy, but remain cautiously optimistic.

Key Quotes

“While most analysts expect favourable base effects and cyclical factors to support growth next year, they noted that signs of a recovery are yet to emerge. A common argument was that there were no signs of an improvement from a microeconomic perspective. However, local economists in general think Korea’s economy may have seen the bottom of the cycle and do not see a further macro slowdown from here.”

“A few analysts held a pessimistic view for next year and said the improving sentiment is similar to end-2018. They highlighted the tendency to turn optimistic at the end of the year.”

“We are more optimistic than the market and believe the current pessimism towards Korea’s economy is overdone. We believe it is too early to assume that Korea’s ageing demographics and manufacturing-intensive industry structure are the reasons for its growth weakness.”