In May, industrial production fell 2.8% over the same month last year, which followed the 2.6% decline recorded in April. May’s print undershot the 2.0% decline that the markets had expected. According to the Korea National Statistics Office, May’s contraction mainly reflected a fall in manufacturing production. The Statistics Office also reported that the construction sector contracted, while the industrial sector and public administration services tallied increases.
A month-on-month comparison roughly corroborates the deterioration suggested by annual data. Industrial production fell a seasonally-adjusted 1.3% in May, which equaled the decline tallied in April. Moreover, annual average growth in industrial output held at April’s minus 0.8%, which marked the lowest level in more than six years.
FocusEconomics Consensus Forecast panelists expect industrial production to expand 3.1% in 2015, which is up 0.4 percentage points from last month’s forecast. For 2016, panelists expect industrial output to increase 3.5%.