South Korean industrial production likely to have grown in November on export recovery

South Korea’s industrial production is likely to have increased in November because of export recovery and end of strike action. Industrial output is expected to have grown in both sequential as well as in year-on-year terms. Two factors behind the strength in industrial production are likely to be the rebound in exports and the end of labor strikes in the auto sector, according to a Societe Generale research report.

The trade data for November indicated all the major sectors such as auto, electronics, chemical and steel were quite healthy, whereas the industry data showed that auto production had totally rebounded from the losses resulting from the labor strike that began in July.

Industrial production data is likely to indicate widespread strength in manufacturing production. The November strength in industrial production would not be enough to secure a rebound in quarter-on-quarter growth in the fourth quarter. Hence the data for December would be vital to affirm the fourth quarter data and also give an idea of the first quarter 2017 outlook. Meanwhile, the focus would also be on retail sales and service industry data in November to observe the effect of political uncertainties on consumption activity, stated Societe Generale.