South Korea’s industrial output flat in July as consumption falls 2.4% and investment rises 7.5%

South Korea’s industrial economy stalled in July even as exports surged, with weaker domestic demand offsetting gains in equipment investment and manufacturing.

The National Data Office said overall industrial production was unchanged from June. Output had fallen in April and May amid the effects of the Middle East war, then jumped 2.4% in June, its strongest monthly increase in six years.

Mining and manufacturing production rose 0.2%. Electronic components increased 20.7% and primary metals rose 4.2%, while automobile production fell 4.5%. Services output declined 1.3%, returning to negative growth after three months. Financial and insurance services fell 4.8%, and professional, scientific and technical services dropped 2.7%. Information and communications output rose 3.5%.

Consumer spending weakened across all major categories. Sales of durable goods, including passenger cars, fell 7.7%; semi-durable goods such as clothing declined 1.4%; and nondurable goods, including cosmetics, fell 0.1%.

Equipment investment climbed 7.5%, supported by a 15.4% increase in transport equipment and a 4.2% rise in machinery. Construction output fell 1.1 as civil engineering activity increased 18.5% but building work dropped 7.4%. The coincident indicator rose 0.8 point and the leading indicator increased 0.4 point.