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KR: Industrial Production
| Actual | Previous | Revised | |
| Month over Month | 5.4% | -1.9% | -2.4% |
| Year over Year | -2.2% | 7.1% | 6.8% |
Highlights
South Korea's index of industrial production rose 5.4 percent on the month in February, rebounding from a fall of a 2.4 percent in Janaury. Output fell 2.2 percent on the year after increasing 6.8 percent previously. Within the industrial sector, manufacturing output rose 6.1 percent on the month after falling 2.8 percent previously and fell 1.8 percent on the year after a previous increase of 6.8 percent. Previously published PMI survey data showed modest expansion in the manufacturing sector in February, with data for March due to be published in coming days.
Today's data also shows stronger conditions in other sectors. Service sector output rose 0.5 percent on the month in February after falling 0.2 percent in Janaury, while construction sector activity surged with an increase of 19.5 percent after a previous contraction of 7.8 percent. Output in the public administration sector, in contrast, posted weaker growth, down 4.6 percent after a previous increase of 7.7 percent. Aggregating across all sectors, output rose 2.5 on the month after a previous fall of 0.9 percent, and rose 0.5 percent on the year after a previous increase of 4.7 percent.
Definition
The industrial production index measures changes in the volume of industrial production with respect to the base year. The index charts the growth in production of each major industry and of the manufacturing sector. Industrial Production measures the physical output of the nation's factories, mines, and utilities. Factories manufacture various products, and the industrial production indexes have been prepared as a comprehensive indicator of wide-ranging production activities for such products and are regarded as some of the most important among economic indexes.
Description
Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that won't lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios.
Industrial production provides key industry data for export-dependent economies. It is highly sensitive to the business cycle and can often predict future changes in employment, earnings and income. For these reasons industrial production is considered a reliable leading indicator that conveys information about the overall health of the economy. This report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Detailed data in the report shows which sectors of the economy are growing and which are not.