New | Korea factory output falls most since 2008 financial crisis
South Korea's factory output last month marked its worst fall since the 2008 global financial crisis, raising concerns about the pace of recovery in Asia's fourth-largest economy even though the government said temporary factors were to blame.
South Korea's factory output last month marked its worst fall since the 2008 global financial crisis, raising concerns about the pace of recovery in Asia's fourth-largest economy even though the government said temporary factors were to blame.
The industrial output index dropped a seasonally adjusted 3.8 per cent from July, Statistics Korea data showed yesterday, the biggest fall since December 2008.
A finance ministry official attributed the decline mainly to strikes by unionised workers at carmakers including Hyundai Motor and said the country remained on track for a modest economic recovery.
Korea's economy has been hobbling since a ferry sinking in April dented consumer sentiment, spurring the government to launch a raft of policy measures to boost demand.
Analysts said the latest data dashed hopes for a quick rebound and might put pressure on the Bank of Korea to ease monetary policy.
"The weaker-than-expected [industrial output] levels in August may raise pressure on the Bank of Korea to lower its rate again, but given the distortions caused by the partial strikes in the car sector, the central bank may want to wait for more data to assess the weakness in demand beyond the temporary shock," said Ronald Man, an economist at HSBC in Hong Kong.
