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Sunday 06th of March 2011
March 3, 2011    

South Korea industrial output hits 17-month high

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by Kay Murchie
South Korea industrial output hits 17-month high

Statistics Korea today said South Korea’s industrial output has expanded at its fastest pace since September 2009.

Output grew by 4.6% in January compared with December, while on an annual basis, output grew by 13.7% - much higher than the 10.6% annual gain posted in December.

The figures easily beat analysts expectations of a 1.4% month-on-month gain and an annual 12.5% rise.

The growth was boosted by strong overseas demand, with semiconductor and car makers leading the way, the statistics office said.

However, surging oil prices could threaten growth in the future, according to analysts.

The figures come just a day after it was revealed South Korea’s inflation rate jumped to a 27-month high – driven by higher food and fuel costs.

According to Statistics Korea, the consumer price index rose by 4.5% in February on an annual basis.

The rate is now at the higher end of the central bank’s 2%-4% target.

Inflationary pressures are rife in Asia and many central banks have opted to hike interest rates in an attempt to combat soaring prices.

In the last few weeks, central banks in China, Indonesia and India have all increased interest rates.

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