South Korea's industrial output edged down 0.5 percent in May from a month earlier due in part to decreased oil refining, government data showed Friday.
The data compiled by Statistics Korea showed oil refining fell
14 percent in May from a month earlier, while production in the service sector increased 0.1 percent on-month.
From a year earlier, industrial output rose 1 percent.
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(Yonhap) |
Kim Bo-kyoung, director of Statistics Korea's industry statistics division, said decreased oil refining can be blamed on weak exports of petroleum products due to the expansion of refining facilities in Asia and decreased production of naphtha, a key raw material for petrochemicals.
Retail sales rose 0.9 percent in May from a month earlier due to increased sales of clothing and electronic goods. Retail numbers gained 3.4 percent on-year last month.
Facility investment fell 8.2 percent last month from April due to decreased imports of semiconductor manufacturing equipment and foreign passenger cars.
South Korean companies imported semiconductor manufacturing equipment worth $34 million in May, down from $42 million in April. The May figure also marked a sharp decline from $74.7 million in May 2018.
Semiconductor output fell 0.6 percent in May from a month earlier.
Semiconductors are a key export product for South Korea, home to Samsung Electronics, the world's largest memory chip maker, and its smaller rival SK hynix.
The May output data is the latest in a series of grim figures pointing to a slowdown in Asia's fourth-largest economy, which is already struggling with falling exports and fragile domestic demand.
South Korea's exports have dropped for six consecutive months since December in the face of drawn-out trade talks between the world's two largest economies, which are also the two largest importers of South Korean products.
South Korea's exports again plunged 10 percent on-year in the first 20 days of this month, according to the customs office.
Hit by a sharper-than-expected decline in exports and business spending, the economy unexpectedly contracted 0.4 percent in the first quarter of the year from three months earlier, marking the worst performance in a decade.
The Bank of Korea is widely expected to further trim its growth outlook for the next month three months after lowering the estimate to 2.5 percent from 2.6 percent amid heightened uncertainty stemming from the trade friction between the world's top two economies.
In the face of slower growth and low inflation, the central bank, breaking away from its earlier commitment to standing pat, is projected to slash the policy rate, currently at 1.75 percent, by a quarter percentage point in the coming months. (Yonhap)
