Korea’s industrial output keeps falling over COVID-19

01-Jul-2020 Intellasia | Xinhua | 6:02 AM Print This Post

South Korea’s industrial output kept falling this year owing to an economic fallout from the COVID-19 outbreak, statistical office data showed Tuesday.

The seasonally-adjusted production in all industries, which exclude agricultural, forestry and fishery sectors, declined 1.2 percent in May from a month earlier, Statistics Korea data showed Tuesday.

Revised figure for industrial production continued to slide for the fifth consecutive month with falls of 2.8 percent in April, 0.1 percent in March, 3.4 percent in February and 0.1 percent in January respectively.

Output in the mining and manufacturing industry tumbled 6.7 percent in May from a month earlier, after skidding 6.7 percent in the previous month. It was the biggest monthly reduction since December 2008.

Production among manufacturers retreated 6.9 percent last month, marking the fastest fall since December 2008.

It was attributed to a double-digit fall in export, which accounts for about half of the South Korean economy. The country’s export plunged more than 20 percent for two straight months through May on the back of the coronavirus pandemic.

Production in the automotive sector dropped 21.4 percent in May from a month earlier, and the output of machinery equipment shrank 12.9 percent.

Manufacturers posted an average capacity ratio of 63.6 percent in May, down 4.6 percentage points from a month earlier. It was the lowest in more than 11 years.

Inventory among manufacturers advanced 8.6 percentage points to 128.6 percent in May, the highest in almost 22 years.

Output in the services sector increased 2.3 percent in May from a month ago, logging the biggest expansion in 76 months. The services industry’s production declined 3.5 percent in February and 4.4 percent in March before growing 0.5 percent in April.

Production in the wholesale and retail sector increased 3.7 percent, and output in the eatery and lodging industry jumped 14.4 percent in the month.

It came as the government provided relief grants to all households in a bid to help reinvigorate consumer spending.

The private consumption was initially hit hardest by the COVID-19 outbreak as people refrained from outside activity such as shopping, travelling and eating out amid the fear of virus infection.

Retail sale, which reflects private consumption, climbed 4.6 percent in May from a month earlier, after growing 5.3 percent in the previous month.

The sale of durable goods such as cars picked up 7.6 percent on the back of a temporary tax cut for car purchase.

The sale of semi-durables such as clothing jumped 10.9 percent last month, and the non-durable goods sale added 0.7 percent.

The cyclical factor for leading economic indicators, which measure the outlook for future economic situation, kept falling for the fourth consecutive month to 98.9 in May, the lowest in nine months.

The figure for coincident indicators, which reflect the current economic situation, continued to decline for the fourth straight month to 96.5 in May. It was the lowest since January 1999.



Category: Korea

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