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S. Korean retailers' outlook index edges up for Q2

All News 14:02 April 14, 2016

SEOUL, April 14 (Yonhap) -- South Korean retailers' business sentiment improved slightly for the second quarter of 2016 from three months earlier, but it was still below par amid a longstanding economic slump, a poll showed Thursday.

The Korean Chamber of Commerce and Industry (KCCI) said its retail business survey index (RBSI) stood at 98 for the April-June period, up from 96 tallied for the first quarter.

A reading above 100 means that optimists outnumber pessimists. After reaching 100 for the second quarter of 2015, the index flatlined at 96 for three consecutive quarters. The survey was taken on 943 retailers in Seoul and six other large cities.

"After moving sideways for three quarters, the index rose slightly for the current quarter," the KCCI said. "The retail business is expected to improve down the road amid recovering domestic demand."

According to the findings, Internet shopping malls expect their business conditions to turn for the better in the second quarter, while the outlook is bleak for home shopping companies and other retailers.

The index for the Internet shopping industry reached 111 for the current quarter, up from 104 three months earlier, thanks to price cuts and daily delivery services. In February, sales at Internet shopping malls surged 22.7 percent on-year.

The home shopping sector is projected to suffer worsening business conditions as a growing number of their customers switch to Internet and mobile shopping, with the index tumbling to 89 from 104.

The index for department stores inched up to 98 from 95 amid expectations of a rise in the number of Chinese tourists visiting South Korea during the May Day holiday.

The survey showed retailers citing sluggish sales stemming from dented consumer sentiment as the biggest hurdle for their business in the second quarter, followed by falling profitability and intensifying competition.

South Korea's consumer sentiment remains weak though it gathered slight ground in March. The composite consumer sentiment index came to 100 for March, compared with 98 for the previous month, according to central bank data.

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