Business survey index on downward slope

Business conditions for local companies have reversed with a downswing in the domestic demand sector for the first time in a year and a half.

According to the Federation of Korean Industries¡¯(FKI) latest forecast, released on August 7, the business survey index (BSI) for August, which was compiled on the basis of a poll of the 600 largest firms in Korea in terms of revenues, stood at 91, registering under the 100 mark for the second consecutive month. A BSI reading of below 100 means business conditions have worsened from the previous month.

In particular, the domestic BSI for August was 94.9, recording below 100 for the first time since February last year.

The FKI attributed the decline to seasonal phenomena such as reduced working hours during the summer vacation season and some industries entering the low-demand period. It also said mixed unfavorable factors like delayed financial reforms and the Hyundai crisis were partially responsible.