South Korea’s January industrial activity picked up by the fastest pace in nine months, led by brisk exports in semiconductors, but retail sales shrank for three straight months for the first time since the 2007-2008 global financial crisis, government data showed on Thursday.
Seasonally adjusted mining and manufacturing in January gained 3.3 percent on month, sharply reversing from 0.5 percent contraction in December, according to Statistics Korea. It is the biggest monthly gain since 3.5 percent in May last year.
Semiconductor and electronic components output jumped 8.8 percent and 6.7 percent, respectively, on month, while telecommunications and broadcasting segments dwindled 2.7 percent from the previous month. Factory operation rate averaged at 74.3 percent, up 1.7 percentage points from the previous month. Inventory rose 2.6 percent on month.
Semiconductor shipments continued to rise while the electronic components segment that had done poorly also has improved, said Ou, Un-seon, head of Short-Term Industry Statistics Division at statistics office.
Service sector output grew by 0.5 percent from the previous month, helped by an increase in shipping, finance and insurance sectors while output from wholesale and retail sales as well as sports and leisure industries narrowed.
However, retail sales - a barometer for private consumption - decreased 2.2 percent against the previous month as the fall in durable goods such as automobiles ate into the addition from semi-durable goods such as shoes and clothes. Retail sales have been shrinking for three straight months since the 0.3 percent on-month contraction in November last year. Last time when the figure had fallen for the third month in a row was during the August-December period in 2008 in the wake of the 2007-2008 global financial crisis.
The monthly contraction in private consumption has deepened in January following a fall in the previous two months. Retail sales shriveled 0.3 percent in November and 0.5 percent in December from preceding months.
Retail sales during the Lunar New Year’s holidays that fell in January this year have not expanded as much as the past because people mostly purchased low-cost holiday gift sets following the implementation of anti-graft law that took effect in September, said the statistics office.
By Kim Gyu-sik
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