Financial News: S. Korea Manufacturing Activity Contracts Most Since Mid

S. Korea Manufacturing Activity Contracts Most Since Mid 2023

10/02/2024 - 03:12:00 (RTTNews)

(RTTNews) - South Korea's manufacturing activity contracted at the most pronounced pace since June 2023 amid renewed declines in output and new orders, survey data released by S&P Global showed on Wednesday.

The factory Purchasing Managers' Index fell to 48.3 in September from 51.9 in the previous month.

A score below 50.0 indicates contraction in the sector. Moreover, this was the lowest reading since June 2023.

New orders posted the strongest fall in 15 months due to weak client confidence and stagnating domestic economy. New export orders decreased for the first time in 2024 to date.

In tandem with new orders, output volumes contracted in September. The decline was moderate and the steepest seen for just under a year.

Employment decreased for the first time in five months and the fall was the most marked in one-and-a-half years.

Manufacturers reported a further monthly fall in backlogs of work as subdued order volumes allowed firms to reallocate capacity to complete existing orders.

Amid concerns about stagnating economy, expectations regarding the outlook for production were the weakest since December 2022.

Manufacturers raised their purchasing activity for the thirteenth straight month and stocks of purchases were depleted at the fastest pace since April. Further, there was lengthening in suppliers' delivery times. The extent to which lead times extended was only moderate and the least pronounced for three months.

On the price front, input price inflation eased to the lowest since August 2023. At the same time, output prices were lowered for the first time in 13 months in a bid to stimulate sales.

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