Industry wide, production decreased in November compared to the previous month as the production in both mining and manufacturing, as well as service industries, showed poor performance. Mining and manufacturing production recorded a slight fall of -0.4%, which was influenced by semiconductor and parts and automobile production. The labor market in December maintained stable employment conditions. The employment rate increased by 1.9% or 441,000. The CPI inflation in December recorded a 4.2% growth rate, similar to the previous month, which was mainly attributable to a slightly stabilized price of goods. Core inflation increased by 3.6%. The national economy grew 3.4% during the fourth quarter of 2011 due to the decrease in world trade volume and domestic demand. The National Assembly Budget Office (NABO) projected an economic growth rate of 3.5% in 2012, which is now being considered for downward revision. This is largely because the Euro-area economy is now expected to go into a mild recession in 2012 as a result of the rise in sovereign yields and the impact of additional fiscal consolidation. Growth in emerging and developing economies is also expected to slow down because of the worsening external environment and a weakening of internal demand.

Shin Hushig, Yoo Seung-sun, Won Dongah, Youn Jun-seung