Seoul: Business sentiment in South Korea worsened in March amid rising raw material costs and heightened economic uncertainty stemming from the ongoing conflict involving Iran, a central bank survey showed Friday. The Composite Business Sentiment Index (CBSI) for all industries stood at 94.1 this month, down 0.1 point from February, according to the survey conducted by the Bank of Korea (BOK).
According to Yonhap News Agency, the index for manufacturers remained unchanged from a month earlier at 97.1 in March, while the figure for non-manufacturers slipped 0.2 point to 92. A separate CBSI index projecting business sentiment for the following month also fell. The monthly CBSI projection index for April dropped 4.5 points to 93.1. The April outlook among manufacturers fell 3 points to 95.9, while that among non-manufacturers declined 5.6 points to 91.2. A reading below 100 indicates that pessimists outnumber optimists.
"Rising raw material costs and heightened uncertainty stemming from the conflict outweighed strong IT exports," a BOK official said. Global oil prices have risen markedly as U.S.-Israeli strikes on Iran, which began late last month, have escalated into a broader regional conflict. The Strait of Hormuz has effectively been closed, disrupting global oil supplies. The survey, conducted earlier this month, covered 3,223 companies, including 1,790 manufacturers.