'Rebound in Production, Consumption, and Investment After 3 Months'... "A Meaningful Result Indicating a Bright Outlook"

Hong Nam-ki, Deputy Prime Minister for Economy and Minister of Economy and Finance (file photo)

[Asia Economy Reporter Joo Sang-don] In September this year, a 'triple increase' was observed, with production, consumption, and investment all rising simultaneously. This is the first time since June this year. Regarding this, Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, evaluated it as "a meaningful result that makes the outlook for the fourth quarter relatively bright."

According to the 'September Industrial Activity Trends' released by Statistics Korea, total industrial production increased by 2.3% compared to the previous month.

Production in manufacturing industries such as automobiles (13.3%) and semiconductors (4.8%) increased, leading to a 5.4% rise in manufacturing production. Automobile production increased due to new car launches and increased exports to North America, while semiconductor production rose due to increased output of memory semiconductors such as DRAM and flash memory.

Retail sales, an indicator of consumption, increased by 1.7%. Sales of nondurable goods such as food and beverages (3.1%) and semi-durable goods such as clothing (1.5%) increased. This was due to increased demand for home-cooked meals amid strengthened social distancing measures and increased purchases of holiday gift sets ahead of Chuseok in October.

Facility investment decreased by 1.5% in machinery such as special industrial machinery, but investment in transportation equipment such as ships surged by 34.3%, resulting in an overall increase of 7.4%.

Indicators reflecting the current economic situation and future outlook also rose together for the fourth consecutive month. The coincident index cyclical component, which indicates the current economic situation, rose by 0.3 percentage points compared to the previous month, and the leading index cyclical component, which shows future economic prospects, also increased by 0.4 points.

An Hyung-jun, Economic Trend Statistics Officer at Statistics Korea, said, "With the coincident index cyclical component and the leading index cyclical component rising together for four months, the figures suggest that economic improvement can be expected."

On the same day, Kim Yong-beom, First Vice Minister of Economy and Finance, presided over the Innovation Growth Strategy Review Meeting and Policy Review Meeting, stating, "Following the successful rebound of the third quarter GDP, the improvement of key indicators in September, the last month of the third quarter, and the significant improvement in economic sentiment in October, the first month of the fourth quarter, further raise expectations for economic recovery. We will do our best to continue the recovery trend in the fourth quarter through strong domestic demand activation measures."