S. Korean business hopes low for July

By Kim Deok-hyun
SEOUL, June 29 (Yonhap) -- Most South Korean businesses are pessimistic about
whether economic conditions will improve in the coming month, as they face rising
prices for oil and commodities, a survey showed Monday.
The monthly business survey index by the Federation of Korean Industries, a
barometer of corporate business sentiment, was at 98.7 for July, down from 100.2
in June.
The index fell below the benchmark level of 100 for the first time since May,
when it stood at 103.8. A reading below 100 means most companies predict their
business conditions to worsen.
Helped by the government's stimulus packages and monetary easing measures, South
Korea's economy averted a technical recession in the first quarter of this year,
posting a 0.1 percent growth in the quarter after a 5.1-percent contraction in
the previous quarter.
Some economists worry that the economy may lose steam in the second half of this
year as the effects of government spending fade amid pressures to raise interest
rates, spurred by fears over inflation.
Despite those concerns, the Ministry of Strategy and Finance last week upgraded
its economic outlook for this year to a 1.5 percent contraction, compared with a
previous prediction of minus two percent growth.
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