South Korea Oct factory output drops at fastest pace since May 2020

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Workers labour on steel frames at a construction site in central Seoul

SEOUL (Reuters) – South Korea’s factory output dropped in October by more than expected and at the fastest pace in nearly 2-1/2 years, government data showed on Wednesday, amid weakening demand due to a global economic slowdown, and aggressive rate hikes.

The country’s industrial output fell by a seasonally adjusted 3.5% in October from a month earlier, accelerating from a revised 1.9% decline in September, according to Statistics Korea.

It missed economists’ expectations of a 1.0% fall tipped in a Reuters survey and marked the fastest decline since May 2020.

By product, cars and machineries fell 7.3% and 7.9%, respectively, leading the losses.

Output for the services sector fell 0.8%, faster than 0.2% a month before and the fastest since Dec. 2020, while retail sales lost 0.2%.

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The country’s factory output fell 1.1% on a yearly basis, also below 0.0% expected in the survey, snapping a 12-month streak of annual gains.

(Reporting by Jihoon Lee; Editing by Mark Porter and Muralikumar Anantharaman)