South Korea’s factories grow at the strongest pace in four months, driven by demand for chips and cars

Factory activity in South Korea rose in September at the strongest pace in four months, while export demand recorded its fastest growth in fifteen and a half years, mainly thanks to the chip and automobile sectors, as Reuters reports based on the survey published on Thursday.

The Purchasing Managers’ Index (PMI), published by S&P Global, reached 53.9 points in September, from 52.3 in August — the highest level since May — and remained above the 50-point threshold separating expansion from contraction for the tenth consecutive month, Reuters reports.

S&P Global Market Intelligence economist Usamah Bhatti said that “the rise in new orders and output reached the highest level in about five and a half years, with evidence linking the expansion to the combined strength of the semiconductor and automobile sectors”.

According to the same survey, output rose at the sharpest pace since March 2021, while new orders increased at the fastest pace since February 2021. New export orders recorded their biggest jump since March 2011, with particular strength in Europe and Asia. Manufacturers’ optimism for the coming year improved to its highest level in eight months.