July 7, 2022

South Korea recorded its industrial output in November to rise the most in 17 months by 3.2 percent from the previous month.

According to the data compiled by Statistics Korea, the latest figure is a turnaround from a 1.9 percent on-month fall recorded in October.

Industrial output in November –

• Last month, the facility investment grew by the most in seven years adding 10.9 percent on-month, compared with a 5 percent decline in October.
• However, retail sales declined by the most in November in 16 months due largely to the base effect.
• In the reporting month, retail sales fell 1.9 percent on-month, compared with a 0.1 percent on-month advance in October.
• The country’s exports rose 32.1 percent on-year to hit a record high of US$60.44 billion in November.
• In the same month, output in the manufacturing sector on the back of an increase in production of autos and chips grew 5.3 percent.
• Automobile output due to an eased shortage of auto chips rose 11.3 percent on-month.
• In November, service output rose 2 percent on-month.
• Lastly, the production in the accommodation and eatery sector rose 5.6 percent in November.

According to the statistics agency, industrial output in November rebounded due largely to the base effect. However, output in the manufacturing and service sectors remained robust last month.

The country’s economy is rather facing growing downside risks due to the latest upsurge in COVID-19 cases and the spread of the omicron variant, thus casting a cloud over the recovery of private spending.

According to Bank of Korea (BOK), the economy in the third quarter grew 0.3 percent from three months earlier, slowing from a 0.8 percent on-quarter gain in the second quarter.

In the July-September period, private spending contracted 0.2 percent, compared with a 3.6 percent on-quarter gain three months earlier.

The central bank data expects the economy to grow 3 percent next year after the estimated 4 percent increase this year. On the other hand, the Korean government expects 3.1 percent growth for next year.

The finance ministry recently maintained a rather upgraded revision of its 2022 outlook to 2.2 percent from its earlier estimate of 1.4 percent. While the BOK is forecasting consumer prices to grow 2 percent next year.