SEOUL- South Korea’s factory output fell in March by the most in 15 months, government data showed on Tuesday, missing market expectations.
The industrial production index fell 3.2 percent from a month earlier on a seasonally adjusted basis, after a gain of 2.9 percent in February and compared with a rise of 0.6 percent tipped in a Reuters survey of economists.
It was the fastest monthly fall since December 2022 and caused by declines in metal processing and electronic parts, according to Statistics Korea.
On an annual basis, production rose 0.7 percent , slower than the previous month’s 4.6 percent rise and an increase of 5.4 percent expected by economists.
Meanwhile, South Korea’s central bank is considering additional purchases of gold in the mid- to long-term as foreign exchange reserves grow, it said on Tuesday, after a recent surge in gold prices.
The bank’s rare comments come after this month’s record high of $2,431.29 an ounce in spot gold as growing Middle East tension drove investors to seek safe-haven assets. The metal has risen 13 percent this year, building on a gain of 13 percent in 2023.
“We will monitor the development of the domestic foreign exchange market and trends in the global gold market to determine the timing and size of gold investment,” the Bank of Korea (BOK) said in an online blog post.
The bank’s Reserve Management Group said in the post that it needed to be cautious when investing in gold, but advantages offered by the precious metal included its role as a hedge against inflation and an alternative to the US dollar.
Recent gains in gold prices were due mostly to purchases by central banks of countries such as China, Russia and Turkey, which are trying to become less dependent on the US currency or guard against war, the BOK said.