South Korea's industrial output reduces on sluggish auto, handset

South Korea's industrial output reduced last month due to sluggishness in the nation's main economic drivers such as handset and automobile, a government report showed Monday. Production in all industries, including manufacturing, service, construction and public administration sectors, fell 0.3 percent in November from a month earlier after increasing 1.4 percent in the prior month, according to the Finance Ministry. From a year earlier, the output rose 1.2 percent in November, down from a 4.1 percent gain in the prior month. Output in mining and manufacturing industries was unchanged in November from a month earlier after climbing 2.1 percent in October, the fastest growth in 11 months. The ministry said that production in cars and handsets, the economy's two major engines, fell last month, noting that the reduction offset increase in output of chips and chemical products. Exports, which account for around half of the economy, fell 1.9 percent from a year earlier to 48.81 billion U.S. dollars in November after topping the 50-billion-dollar level in the prior month. The weak exports led to a fall in the current account surplus of 6.03 billion dollars in November from a surplus of 9.51 billion dollars in October, the highest in the country's history. Manufacturers operated at an average capacity of 75.7 percent in November, down 0.1 percentage point from a month ago. Inventories advanced 2.5 percent, but shipments reduced 0.3 percent. Output in the service industry edged up 0.1 percent on-month in November after rising 0.4 percent in the prior month. Activities in the real estate industry declined 1.3 percent, but it was offset by a rise in the education and financial sectors. On the expenditure front, retail sales grew 0.9 percent in November from a month earlier, but it was lower than a 1.5 percent increase in October. Sales of durable goods slid 1 percent, indicating a still fragile domestic demand. Facility investment sank 5.5 percent last month after jumping 19.4 percent in the prior month. Machinery orders plunged 13.7 percent in November, down from a 66.6 percent surge in October. The value of construction completed at a constant price inched down 0.2 percent in November, down from a 3.5 percent rise in the previous month. Construction orders received at a current price tumbled 30.9 percent. The cyclical component of the composite leading indicator, which reflects outlook for industrial activities, showed no change last month compared with the prior month, but the coincident index of economic indicators rose 0.2 point. The Finance Ministry said that industrial activities showed some adjustment last month, noting that negative factors remained due to the long-drawn-out strikes of rail workers, which will affect the result of the December industrial output.