Korea's June factory output hits 6-year high, chip lifts domestic front

SEOUL, July 31 (AJP) - South Korea's factory output soared to a six-year high in June as robust automobile demand complemented chip activity, lifting the broader domestic economy.

Mining and manufacturing output climbed 5.8 percent from May and 6.4 percent from a year earlier, the strongest monthly performance since June 2020, according to data released Friday by the Ministry of Data and Statistics. The rebound followed a revised 2.9 percent decline in May. 

Automobile production surged 15.4 percent from the previous month and 12.6 percent from a year earlier, returning to double-digit annual growth after contracting for two consecutive months. 

Semiconductor production rose 4.5 percent from May and 2.2 percent from a year earlier. While the monthly gain accelerated from May's 1.5 percent increase, annual growth remained far below April's 13.3 percent pace, suggesting chip output is stabilizing after an exceptionally strong run. 

Reflecting the broader recovery, overall industrial production excluding agriculture, forestry and fisheries increased 2.3 percent from the previous month and 4.2 percent from a year earlier. 

Domestic demand also showed signs of strengthening. 

Retail sales rose 2.7 percent from May, marking the strongest increase in five months as household spending improved despite persistent inflation. 

Facility investment climbed 5.8 percent from the previous month, the fastest increase in four months, and jumped 21.7 percent from a year earlier as semiconductor makers continued expanding production capacity. 

Construction completed, a gauge of current building activity, also increased 4.1 percent from May. 

Despite the strong June rebound, manufacturing output grew about 2.0 percent in the April-June quarter from the previous three months, easing from 2.7 percent growth in the first quarter, indicating that industrial momentum moderated on a quarterly basis even as June capped the period on a strong note.

Retail sales increased to a five-month high of 2.7 percent amid income increase despite inflationary pressure.
Facility investment rose to a four-month high of 5.8 percent and jumped 21.7 percent on year amid active chip expansion.

Construction completed gained 4.1 percent from the previous month.

The manufacturing output April-June period slowed to on-quarter 2-percent growth, slowing from 2.7 percent in the previous three-month period.  

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