Top Line: Korea’s recovery and continued growth hangs in the balance at the beginning of December

Increasingly the indications of an exceptionally vibrant external sector coupled with ample liquidity in the hands of a section of consumers is in contrast with the sections of the economy that remain depressed.  If we think of the economy as being divided into three parts, exports exceptionally vibrant, but narrowly led by a small group of industries, the middle part rising and falling with the general level of economic activity and the failing sector of households and small businesses the third part.  Living with covid policy clearly revived some social activities and increase consumer expenditure in selected areas, but not to the extent of helping most of the failing economy.    Omicron is likely to pull down growth, already a bit slack in terms of general activity slowing in October, and with only a slight recovery in November when the export sector soared ahead despite chip shortages and supply problems.