SEOUL- South Korea’s factory output in August beat market expectations and increased by the most in a year, led by production of cars and chips, government data showed on Monday.
The industrial output index rose 4.1 percent over the month on a seasonally adjusted basis, after a dip of 3.9 percent the previous month, according to Statistics Korea.
It was faster than a gain of 2.0 percent tipped in a Reuters poll of economists and the biggest rise since August 2023.
Production of automobiles jumped 22.7 percent, while semiconductors grew 6.0 percent.
Industrial production rebounded sharply as output disruptions in the auto industry eased, the finance ministry said after the data release.
“The manufacturing sector-led economic recovery is continuing with exports expected to grow for a 12th consecutive month in September,” the ministry said.
On an annual basis, the industrial output index rose 3.8 percent, compared with gains of 5.2 percent the previous month and 1.9 percent expected by economists.
Monday’s data also showed retail sales rose 1.7 percent in August, reversing a fall of 2.0 percent in July, marking the biggest monthly rise since February 2023.
South Korea’s exports are expected to have risen for a 12th straight month in September, but with the growth momentum slowing further, a Reuters poll showed on Friday.
Exports from Asia’s fourth-largest economy are forecast to have risen 6.5 percent in September from a year earlier, according to the median estimate of 17 economists in the survey conducted Sept. 23-27.
That would mark the slowest growth rate in three months. In August, the rate fell to 11.2 percent from 13.5 percent the previous month.
Exports likely have entered a slowing cycle, analysts said. In September, there were also unfavourable calendar effects from a longer break for the Chuseok lunar thanksgiving holiday.
“The slowdown in export growth is expected to become clearer going forward due to a slowing global manufacturing cycle and high comparison bases,” said Park Sang-hyun, an economist at iM Securities.
