SoKor’s factory production in September shrinks

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SoKor’s factory production in September shrinks

South Korea’s factory productivity plunged at a faster pace for the month of September, primarily part of the effects of trade conflicts between opposing economies.

A private study revealed fresh data on Tuesday reflecting South Korea’s factory production slump as The Nikkei/Markit purchasing manager’s index (PMI) went down to 48, coming from 49 in August, still below the 50-point benchmark. The latest decline marks its 10th plunge in the last 11 months.

“Notably, the stabilization in export demand did not coincide with any improvement in the total new orders, which fell further, indicating that external weakness has started to spill over into domestic markets,” economist at HIS Markit Joe Hayes said.

“Forward-looking indicators such as employment and business confidence, the only measure of sentiment within the PMI survey, both showed little hope for a recovery to ensue anytime soon,” he added.

The chief of the Bank of Korea held the benchmark interest rate at 1.50% in August. Analysts expect that the central bank will cut rates again after its monthly meeting on Oct. 16.

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