South Korea Jan­uary fac­tory out­put falls

The Pak Banker - - 6BUSINESS -

South Korea's in­dus­trial out­put fell at its fastest pace in a year in Jan­uary as pro­duc­tion of key ex­port items such as semi­con­duc­tors and cars weak­ened, lend­ing strength to views the cen­tral bank may lower rates again soon.

The weak pro­duc­tion data came ahead of a sep­a­rate pri­vate-sec­tor sur­vey that showed man­u­fac­tur­ing ac­tiv­ity con­tract­ing at its fastest pace in six months as poor ex­ports leave Asia's fourth-largest econ­omy strug­gling to mount a solid re­cov­ery.

Fac­tory out­put in Jan­uary fell 1.8 per­cent from De­cem­ber in sea­son­ally-ad­justed terms, far worse than a re­vised 0.5 per­cent gain for De­cem­ber and a me­dian 0.6 per­cent slip tipped in a Reuters sur­vey.

It was also the sharpest de­cline since a 3.5 per­cent drop in Jan­uary 2015. "We do not feel South Korean ex­ports will im­prove within a short pe­riod of time," said Stephen Lee, an econ­o­mist at Sam­sung Se­cu­ri­ties in Seoul, point­ing to low oil prices and slug­gish de­mand from China.

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