Korea industrial output jumps 3.0 percent in September on semiconductor, auto rebound

South Korea's National Data Office said Friday that industrial production rose 3.0 percent in September from the previous month, its steepest monthly advance in 15 years and six months, as semiconductor and automobile output rebounded sharply.

The all-industry production index, which excludes agriculture, forestry and fishing, reached 122.7 on a seasonally adjusted basis, up 1.1 percent from a year earlier. Mining and manufacturing output jumped 9.0 percent, while service-sector production added 0.5 percent.

Chip production climbed 19.2 percent from August as makers of DRAM and flash memory raised output, while automobile production rose 39.9 percent on stronger assembly of newly launched parts and hybrid passenger vehicles. Medical, precision and optical equipment was the main drag, down 8.8 percent.

The September figures compare with a broad pullback the month before, when all-industry production fell 1.2 percent and factory output dropped 4.6 percent. Unadjusted series can reflect the movement of major holiday periods and the effects of labor disputes, and the most recent two to three months of figures include preliminary data subject to revision.

Retail sales rose 3.6 percent from August as demand for food and beverages, cosmetics and passenger cars increased, though they were 0.4 percent lower than a year earlier as durable goods such as cars fell 10.8 percent.

Capital investment rose 5.3 percent on the month, helped by a 4.7 percent increase in machinery, including generators and electric control panels, and a 7.4 percent rise in transport equipment. Construction completed rose 5.8 percent, with both building and civil engineering work increasing.

The cyclical component of the coincident composite index gained 0.5 points from the previous month, while the leading composite index fell 0.1 points, as machinery domestic shipments and construction orders rose but the Kospi and interest-rate spreads declined.

For the third quarter as a whole, all-industry production was up 0.1 percent from the prior quarter and 2.3 percent from a year earlier. The average manufacturing capacity utilization rate climbed 5.6 percentage points on the month to 76.8 percent.

Construction orders surged 49.8 percent from a year earlier, driven by a 41.4 percent rise in building orders including factories and warehouses and an 84.5 percent jump in civil engineering orders such as railways and rail tracks. Domestic machinery orders rose 28.2 percent, as a 68.8 percent drop in public-sector orders was offset by a 46.7 percent gain in private demand.