South Korea April factory output falls, retail sales drop most in 5 months
SOUTH Korea’s factory production and retail sales dropped in April, official data showed on Wednesday (May 31), indicating another tough quarter after the economy narrowly averted a recession in the first quarter.
Factory production in April fell 1.2 per cent from March, on a seasonally adjusted basis, coming in slightly softer than a 1.6 per cent loss tipped in a Reuters survey.
In March, output rose by 5.3 per cent month-on-month, which was the fastest gain since June 2020, according to Statistics Korea.
Output in April was down 8.9 per cent from the same month a year earlier, compared with a decline of 7.6 per cent in March and a year-on-year drop of 7.9 per cent expected by economists. It was the biggest annual loss in three months.
The all-industry output index, which includes the manufacturing as well as services sectors, fell 1.4 per cent in April over a month, marking the first monthly decline since November and the biggest drop in 14 months.
On the consumption side, retail sales dropped 2.3 per cent from a month earlier, after a 0.1 per cent gain in the previous month, marking the first monthly fall since January and the biggest in five months.
The finance ministry said data showed the economy went through a “moderate correction from the recovery in the first quarter”.
The ministry said both upside and downside factors are likely to impact the economic trend, such as spill-over effects from China’s reopening and high inventory levels in the semiconductor industry, respectively.
The weak economic activity in April follows the country’s slim growth in the first quarter of this year, which was just enough to prevent Asia’s fourth-largest economy from falling into a recession. REUTERS
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