South Korea's industrial output dropped slightly in June from a month earlier due to the dip in petroleum refinery and chip businesses, but consumption made a turnaround to offset the sluggish production, government data showed Friday.
(Yonhap)
Production in the mining, manufacturing, gas and electricity industries edged down 0.2 percent on-month in June, backtracking from a 0.2 percent on-month gain in the previous month, according to the data by Statistics Korea.
From a year earlier, output also lost 0.3 percent last month due to sluggishness in semiconductors and transportation equipment companies.
Production in the service sector rebounded 0.5 percent last month from a month earlier, with a 2 percent on-year rise.
Retail sales rose 1.1 percent last month compared with the previous month and also advanced 1 percent from a year earlier.
For all industries, output inched down 0.1 percent in June from a month earlier but climbed 1.5 percent from a year earlier, the data showed.
The statistics office said the latest data showed the production side slowed down to some extent amid inventory adjustments, while the demand side seems to be pulling itself out of a protracted slump.
"We are seeing demand and supply heading in different directions. Output is on a slight decline, but expenditures are likely on a rise," said Eo Woon-sun, director of the short-term industrial statistics division at Statistics Korea. "But output can make a clear upturn in the future if rising demand stimulates production."
Chips production fell 3.9 percent on-month in June due to the active adjustment of inventories following a 8.9 percent jump in the previous month.
As a result, the industrial inventory level decreased 3.8 percent on-year in June, led by a 32.5 percent drop in chips and 4.7 percent fall in chemical products.
Despite the negative growth in June, the semiconductor business remained upbeat as a whole on recovering global demand for mobile devices and computers, the official said.
He also said the local oil refiners saw their production retreat 7.4 percent on-month as they had a temporary production halt for facility maintenance last month.
On the other hand, retail sales made a rebound in June on brisk sales of cosmetics and clothes, showing signs of recovery.
"The number of foreign tourists rose slightly last month from a month earlier, and they bought a large amount of Korean-made cosmetics in duty-free shops," said Eo, the statistics official.
"It's a good sign that private consumption is recovering."
According to separate central bank data, South Korea's consumer sentiment improved for the sixth consecutive month in July to reach more than a six-year high. (Yonhap)
