By Kim Sung-jin
Staff Reporter


Industrial output grew 8 percent from a year earlier in October, the fastest pace in nine months, propelled by robust production of microchips and audiovisual equipment and a turnaround in domestic car production.

This compares with a 7.3 percent gain in September and is the highest since January when it grew 14.3 percent, the National Statistical Office (NSO) said. Seasonally adjusted industrial output grew 1 percent from the previous month in October.

October’s output figure is at the higher end of market expectations ranging between 6 and 8 percent, indicating that the nation’s economy is on a modest recovery track, analysts said.

``Exports have been brisk in October, hitting an all-time high. Automakers’ production also normalized, emerging from labor strikes,’’ Hyundai Securities economist Lee Sang-jae said. ``The retail sector output is also likely to increase in coming months too.’’

Lee predicted that industrial output will maintain its upward momentum in November.

By sector, chip production surged 36.7 percent in October from a year earlier, while production of audiovisual equipment rose 12 percent.

Automobile production made a turnaround in October from the 11.1 percent year-on-year drop recorded in September mainly due to strikes at Hyundai Motor and Kia Motors, growing 6.1 percent from a year ago.

Consumer goods sales, the key determinant for a full-fledged economic recovery, climbed 3.4 percent last month from a year ago. Nevertheless, considering that consumer goods sales posted negative growth in October 2004, the speed of recovery in consumer goods sales is still slow, it said.

``The overall economy appears to be on the recovery track after bottoming out. Private consumption seems to be on a recovery trend as well. But given the lower base a year earlier, we are not in a full-fledged recovery as of yet,’’ said Kim Kwang-sup, NSO director in charge of the industrial trend division.

Corporate capital spending on plant and equipment grew 1.7 percent in October on increased investments in computers and electrical and electronics production facilities.

Hyundai Securities’ Lee said that the overall corporate investment was still weak.

Domestic construction orders tumbled 34.8 percent last month from a year earlier, pointing to the continued slump in the construction industry, the report showed.

sjkim@koreatimes.co.kr